VA Home Appraisal

If you're using a VA loan to buy a home, a VA appraisal is an important part of the process.

But what exactly is a VA appraisal?

Does it mean the home has been inspected?

What happens if the home doesn't appraise for the purchase price?

And what happens if the appraiser finds something wrong with the property?

If you're a veteran or service member preparing to buy a home with a VA loan, understanding the appraisal process can make the home-buying experience much less stressful.

Let's break it down.

What Is a VA Appraisal?

A VA appraisal is an evaluation performed by a VA-approved appraiser to determine the property's market value and whether the property meets applicable VA Minimum Property Requirements (MPRs).

The appraisal serves two important purposes:

1. Determine the property's value

The appraiser reviews the property and comparable homes in the area to determine an opinion of the home's market value.

2. Determine whether the property meets VA requirements

The appraiser also looks for certain conditions that could affect the property's eligibility for VA financing.

The goal is to make sure the property is:

✔️ Safe✔️ Structurally sound✔️ Sanitary✔️ Suitable for residential use

🔎 Is a VA Appraisal the Same as a Home Inspection?

No.

This is one of the most important things for VA buyers to understand.

A VA appraisal asks:

“Is this property worth the purchase price, and does it meet VA requirements?”

A home inspection asks:

“What is the condition of this home, and what should the buyer know before purchasing it?”

A VA appraisal is not a substitute for a professional home inspection.

An appraiser may identify certain visible problems, but they are not performing the same detailed evaluation as a home inspector.

That's why I strongly encourage buyers to understand the difference and discuss both with their real estate professional and lender.

🏠 What Does the VA Appraiser Look At?

The appraiser evaluates the property and considers things such as:

• Overall condition

• Structural components

• Roof condition

• Heating systems

• Electrical systems

• Plumbing

• Water and sanitation

• Access to the property

• Safety concerns

• Property value

• Comparable properties in the area

The appraiser is not necessarily looking at every component of the home the way a professional home inspector would.

Instead, they're determining whether the property meets the requirements for the VA loan and whether the value supports the transaction.

💰 How Is the VA Appraisal Value Determined?

The appraiser generally looks at comparable properties—often called “comps”—to help determine the property's market value.

They may consider:

• Recent sales

• Location

• Size

• Number of bedrooms and bathrooms

• Age

• Condition

• Features and improvements

• Overall market conditions

The appraiser then provides an opinion of the property's reasonable value.

Here's an important distinction:

The appraiser isn't simply determining whether the home is “worth it” to you.

They're determining the property's market value based on available data and professional appraisal methodology.

💵 What Happens If the VA Appraisal Comes in at the Purchase Price?

This is the easiest scenario.

Let's say:

Purchase price: $400,000VA appraised value: $400,000

Great!

The value supports the purchase price, assuming all other loan and property requirements are satisfied.

The transaction can continue toward closing.

📉 What Happens If the VA Appraisal Comes in Low?

This is one of the questions I hear most often from buyers.

Let's say you agree to purchase a home for:

$400,000

But the VA appraisal comes back at:

$380,000

Now there is a $20,000 difference between the purchase price and the appraised value.

Does that automatically mean the deal is dead?

No.

There are several potential options.

Option 1: The Seller Reduces the Price

The buyer and seller may negotiate a lower purchase price.

For example:

Original price: $400,000Appraisal: $380,000Negotiated price: $380,000

If the seller agrees, the transaction may be able to move forward at the appraised value.

Option 2: The Buyer Brings the Difference

A VA buyer may be able to pay the difference between the purchase price and the appraised value with their own funds.

For example:

Purchase price: $400,000Appraisal: $380,000Difference: $20,000

If the buyer wants to proceed at $400,000, they may be able to bring the $20,000 difference to closing, subject to lender requirements and the specific transaction.

This is something you should discuss with your lender before making any decisions.

Option 3: The Parties Renegotiate

Sometimes the buyer and seller reach a compromise.

For example, the seller could reduce the price somewhat and the buyer could contribute some of the difference.

The possibilities depend on the circumstances and the terms of the purchase agreement.

Option 4: Challenge the Appraisal

There are situations where an appraisal may be reconsidered.

A Reconsideration of Value (ROV) may be possible when there is relevant information that wasn't adequately considered in the original appraisal.

For example, there may be:

• Additional comparable sales

• Errors in the property information

• Incorrect square footage

• Incorrect features

• Other relevant information

Your lender can explain the ROV process and whether it may be appropriate in your situation.

🛠️ What Happens If the Appraiser Finds Problems?

This is another area where VA buyers sometimes become nervous.

Remember that the VA has Minimum Property Requirements designed to help ensure that properties securing VA loans are safe, sanitary, and structurally sound.

If the appraiser identifies a condition that does not meet applicable VA requirements, the issue may need to be corrected before the loan can proceed.

Examples could potentially include issues involving:

• Roof condition

• Safety hazards

• Electrical problems

• Structural concerns

• Water or sanitation issues

• Certain heating or cooling problems

• Other conditions affecting the property's habitability

The exact requirements depend on the property and the circumstances.

🏚️ Does Every Repair Have to Be Completed Before Closing?

Not necessarily.

The answer depends on the specific issue and the requirements identified by the appraiser and lender.

Some issues may need to be corrected before the VA loan can close.

In other situations, a different solution may be possible.

Your lender and real estate professional can help you understand what needs to happen when an appraisal identifies a concern.

The important thing is:

Don't assume that every item mentioned by an appraiser automatically means the transaction is over.

Many appraisal issues can be addressed through repairs, renegotiation, or other appropriate solutions.

⏰ How Long Does a VA Appraisal Take?

The timing can vary depending on:

• Location

• Appraiser availability

• Property type

• Market conditions

• Complexity of the property

• How quickly information is provided

Once the appraisal is ordered, your lender can provide updates about the status.

Your real estate agent may also help coordinate access to the property with the seller or listing agent.

💰 Who Pays for the VA Appraisal?

In a typical VA purchase transaction, the buyer is generally responsible for the appraisal fee, although the exact handling can depend on the transaction and applicable rules.

Your lender will typically order the appraisal and can tell you the current fee and payment process.

Can a Veteran Choose the Appraiser?

Generally, no.

The VA has requirements designed to promote independence in the appraisal process.

Your lender typically requests the appraisal through the appropriate VA-approved process rather than allowing the buyer, seller, or real estate agent to simply select an appraiser.

This helps provide an independent valuation of the property.

❗ What Should Buyers Do Before the Appraisal?

There are a few things you can do to make the process smoother.

1. Get your home inspection

Remember:

Appraisal ≠ Inspection

A professional inspection gives you a much better understanding of the home's condition.

2. Work with your REALTOR®

Your agent can help you understand the purchase agreement, comparable properties, and what happens if an appraisal issue arises.

3. Stay in communication with your lender

Your lender is responsible for the financing side of the transaction and can explain how the appraisal affects your loan.

4. Don't panic if something comes up

An appraisal issue doesn't automatically mean you've lost the house.

Your real estate agent and lender can help you understand your options.

🏡 A Simple Example

Let's say you're a veteran purchasing a home in New Hampshire.

Purchase price: $450,000

The VA appraisal comes back at:

$450,000

The property meets the applicable VA requirements.

That's great!

The transaction can continue toward closing, assuming the other financing and contractual requirements are satisfied.

Now imagine the appraisal comes back at:

$435,000

There's a $15,000 gap.

At that point, the buyer and seller may need to discuss options such as:

• Renegotiating the purchase price

• The buyer paying some or all of the difference

• Requesting a reconsideration of value when appropriate

• Other solutions permitted by the lender and contract

The important thing is to understand your options before making a decision.

🔑 The Bottom Line

A VA appraisal is an important part of the VA home-buying process.

It helps determine:

1. What the property is worth

and

2. Whether the property meets applicable VA requirements.

But remember:

A VA appraisal is NOT a home inspection.

If you're buying a home with your VA benefits, consider getting a professional home inspection so you can make an informed decision about the condition of the property.

And if the appraisal comes back lower than the purchase price or identifies a property issue, don't immediately assume the deal is over.

There may be options.

That's where having an experienced lender and real estate professional on your side can make a big difference.

Your VA Benefit Is Something You've Earned

Buying a home can feel overwhelming, especially when you're trying to understand appraisals, inspections, financing, contracts, and everything else that comes with a purchase.

You don't have to figure it all out at once.

At Veteran Home Corner, my goal is to provide straightforward information to help veterans and military families understand the VA home-buying process.

From pre-approval → finding your home → making an offer → inspection → appraisal → closing → getting the keys, I'm here to help you understand what comes next.

Ready to start your VA home-buying journey?

Sarah Rennells, REALTOR®The Damon Home Team | eXp Realty📱 603-916-0050

Serving veterans and military families throughout New Hampshire.