Though there is no dearth of programs for first time home buyers, veteran and active duty military service men and women no doubt benefit the most from VA home loans. However, if you are a first-time home buyer looking to obtain a VA loan in Texas, or for that matter, in any other state, you must know about the significance of the VA home appraisal. An appraisal fulfills two basic purposes; ensures that the property to be purchased is worth the investment, and that it meets the Minimum Property Guidelines set by the U.S. Department of Veterans Affairs. Here are five elements associated with the VA appraisal that every first-time homebuyer must know.

1. Appraisal Does Not Guarantee Perfect Condition

Although any independent VA-certified appraiser can perform an appraisal, they are not required to ensure that the property is blemish-free. Appraisers are simply responsible to ensure the property is safe, sanitary, and structurally stable. The buyer may still have to bear the costs of some repairs, especially if the property’s been vacant for a while.

2. Appraisal is Not an “Inspection”

Although an appraisal helps the borrower ensure they make a sound investment, the review is not as detailed or comprehensive as a home inspection. That’s the reason why most people purchasing a home always hire a professional home inspection services provider that can identify all issues in the property and help them negotiate the price.

3. Appraisal Fee Can Be Reimbursed by Seller

The VA appraisal fee is one of the most common closing costs, which varies from state to state and property to property. For instance, the VA appraisal fee may not be the same for a single family and manufactured home. What’s important to note is that regardless of the amount of the fee, borrowers may get a reimbursement of the fee by negotiating with the seller. (Note: In “hot” or “seller’s” markets negotiating this with a seller may be difficult. This is where a real estate expert can help.)

4. Appraisal Evaluates the Property’s “Fair Market Value”

One of the primary purposes of a VA appraisal is determining the property’s fair market value. This analysis helps VA lenders to ensure that the borrowers do not pay more than the market value of the property, which they find out by comparing a minimum of three homes similar in terms of age, size, and location.

5. Appraisal is Mandatory to Obtain a VA Loan

Unlike other home loan programs for first time home buyers, the VA requires a property appraisal done through a VA-certified appraiser. Therefore, when you decide to purchase a home through a VA loan, you cannot skip appraisal. The appraisal is a mandatory requirement, and the responsibility of the VA lender.

Conclusion

When you opt to purchase a home through the VA, one of the first steps your lender takes is order a VA appraisal on the property, to assess its value and ensure that you do not overpay. What’s important to note is that there are steps that buyers can take, including home inspection and negotiating for reimbursement of the appraisal fee, to ensure they get maximum value from the transaction. The experienced loan officers at Service First Mortgage can provide detailed information on all these topics and how to use them to your advantage.

Feel free to get in touch with us for a no-obligation consultation.