The appraiser will look at recent comparable home sales when evaluating the home's fair market value. Lenders have no control over the appraiser, their timeline for conducting the appraisal, or their assessment of the property.
The VA assigns an independent, third-party appraiser to assess the property's value and condition. Homebuyers typically cover the appraisal cost up front, although it's possible to seek a reimbursement from the seller at closing.
Your loan team sends your contract and documentation to loan processors and underwriters who set out to verify the loan and the home work for the borrower, lender and the VA.Īt this stage, the lender will also order the VA appraisal. The VA loan process jump-starts once you're under contract. Every buyer-seller situation is different. You may make offers on multiple homes before finding something that works. Also, keep in mind some markets are tougher than others. It might take VA buyers a couple of rounds of negotiation to lock down a purchase agreement. A special addendum ensures VA buyers get their earnest money back if the property's appraised value comes in low and the Veteran decides to back out of the deal. Typical contingencies include the right to have a home inspection, handling repair requests, the number of days the buyer has to secure financing, the required earnest money deposit and more.Įvery VA contract features added protection for the Veteran's earnest money regarding the VA appraisal. Most prospective VA buyers will present a contract with several contingencies that cover specific events leading up to the loan closing. Buyers can ask sellers to pay all their loan-related closing costs and up to 4 percent in concessions, which can cover escrow expenses and much more. VA loan closing costs can vary depending on a host of factors. Veterans should discuss closing costs with their loan officer and agent before making an offer. Pricing and negotiation strategies can vary depending on the real estate market, the particular home and much more. Your agent will look at recent comparable home sales in the area to help shape your starting point for a purchase price. Your loan officer and a trusted real estate agent can help you craft a strong offer. Once you find a home you love, the next step is making an offer to buy it. Talk with a loan specialist in more detail if you're looking for that type of property. Purchasing a fixer-upper is possible with a VA loan, but it can present challenges for the VA appraisal process. VA buyers can ask sellers to pay for repairs and even cover the cost themselves if needed. If the appraiser notes MPR issues, they may require fixing before closing the loan. The VA doesn't require a home inspection, but home inspections are almost always a sound investment. MPRs are a high-level overview and not as in-depth as a home inspection. The VA appraisal process includes a look at the home in light of some general property condition requirements, known as the Minimum Property Requirements (MPRs). Homes generally need to be in good shape. Veterans can look to buy a multi-unit property (up to a four-plex) as long as they plan to live in one of the units. Like the other government-backed mortgage options, VA loans are for purchasing primary residences you intend to live in full-time.
* Veterans United does not currently make a traditional construction loan. This step of the VA loan process can take minutes to hours, depending on your lender's documentation requirements.ĭocument requests can differ depending on the nature of your income, your military service history and more. You don't need a COE to start the process since lenders can typically access this document on your behalf with only a date of birth and social security number.Īdditional documents typically include W-2s, recent pay stubs and bank statements. Lenders validate your service history with the Certificate of Eligibility (COE). Some sellers might not even consider your offer without a copy of your preapproval letter.ĭuring preapproval, your lender will look at your credit, finances, employment situation, service history and more.
In today's real estate environment, home sellers expect to see offers from preapproved buyers. Preapproval also adds weight to any offer you place on a home. Preapproval is the initial green light from your mortgage lender and gives you a clear sense of your purchasing power. Getting preapproved for a VA loan is a foundational first step.
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