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What The Florida VA Appraisal Process Looks Like In 2024 [Updated]

VA loans are federally-backed mortgages exclusive to Veterans, service members, and their surviving spouses aspiring to become homeowners.

This loan has no down payment requirements or private mortgage insurance, making it one of the most affordable home financing options.

Besides, the interest rates are highly competitive, and there are no prepayment penalties compared to conventional loans.

Like all home loans, the property you wish to buy using a VA loan must go through an appraisal process. The U.S. Department of Veteran Affairs has various eligibility requirements before issuing VA loans to borrowers, and a VA appraisal is one of them.

If you are considering buying a new home with a VA loan or are a real estate agent seeking to know more about VA loans, this helpful post is for you. You will learn what the Florida VA appraisal process looks like in 2024.

What is a VA Appraisal?

A VA appraisal is a mandatory evaluation conducted by a VA-approved appraiser to determine a property's market value and condition for a VA loan. The appraiser ensures the property complies with the U.S. Department of Veteran Affairs' minimum requirements.

When a borrower submits a purchase contract, the lender must request an appraisal through the VA portal. The Department of Veteran Affairs assigns certified appraisers for this task.

VA appraisals differ from home inspections in purpose and requirement. They are required for VA loans to assess the property's fair market value and adherence to VA standards.

In contrast, an optional home inspection focuses on identifying the property's physical and structural issues but does not determine its market value.

An illustration highlighting the importance of VA Appraisal Process

Why is a VA Appraisal Important?

A Florida VA appraisal is essential as it confirms the loan amount does not surpass the home's market value. This process safeguards the buyer from overpaying, ensuring the price matches the property's worth.

The VA requires minimum standards for homes financed with VA loans. The appraisal assesses the property's market value and condition and checks for safety, hygiene, and structural integrity.

The home must have sufficient space for living, cooking, dining, and sleeping and be accessible via a public or private street.

With the VA guaranteeing the loan, the mandatory appraisal helps mitigate risks for the department. It also secures the buyer's investment by confirming the home's price is fair for a primary residence.

In the appraisal process, the VA, the approved appraiser, and the lender collaborate to resolve any issues identified, ensuring all parties' interests are protected.

Does a Lender Select a Local Appraiser for a VA Loan?

For a VA home loan, a lender cannot choose the appraiser. Appraisers must remain neutral to serve the lender's and borrower's interests fairly.

The VA plays an active role in ensuring unbiased appraisals for VA loans. It selects and assigns appraisers when a home is purchased with a VA loan.

In the case of conventional loans, lenders request appraisals through an Appraisal Management Company (AMC). AMCs are independent entities that aren’t affiliated with lenders. They handle administrative tasks and select qualified appraisers randomly.

The VA acts similarly to an AMC for VA loans. Once the lender has a purchase contract and requests an appraisal, the VA picks and assigns an appraiser.

The VA's system ensures the selection of the most suitable appraiser for the property's location, independent of the lender's location.

When Should One Order a VA Appraisal?

Your lender should order a VA appraisal immediately after getting the purchase contract, preferably on the first day. This is because VA appraisals can take time.

Some lenders wait to order the appraisal until they have the borrower's credit card on file. Others might wait until the pre-approval stage. They do this because the homebuyer pays for the appraisal, and the lender wants to make sure the appraiser gets paid.

Ordering the appraisal early helps confirm the property's value quickly, reducing stress and uncertainty about the purchase. It also allows the VA and lender to deal with issues early, smoothing the buying process.

A quick appraisal can help you close the deal sooner and start your homeownership journey.

Where Do We Order a VA Appraisal?

A VA appraisal differs from a standard home appraisal because the U.S. Department of Veteran Affairs oversees it. The department picks and assigns appraisers for each area.

To request a VA appraisal, lenders must be VA-approved and use the VA's secure web portal. They log in with their credentials and submit the appraisal request.

Once the VA receives the request, it finds a suitable appraiser from its database for the specific location. As a homebuyer, you need to pay the appraisal fee in advance.

The cost varies depending on the home type and purchase location. However, you might be able to get this fee back at closing through negotiations with the seller.

What Happens During a VA Appraisal Process?

Even though a VA appraisal is an intricate process, it does not have to be intimidating. After all, many factors come into play when determining the home value, and the appraiser does not often have the final word on the property.

Understanding what happens during a VA appraisal can help ease your fears and anxieties. Here’s what you need to know about VA appraisals:

Upon receiving a paid appraisal request, the VA will select and assign an approved appraiser to the home you intend to buy.

The appraiser appointed by the VA to handle the assignment must respond and schedule an appointment within two business days.

The appraiser will evaluate the property’s value based on its condition and other comparables to ensure it is sufficient for the proposed loan amount.

The appraisal also assesses minimum property requirements before compiling the information into a report and submitting it to the VA-approved lender.

Upon receiving the report, the lender must upload it to the VA web portal for review by an underwriter, a VA staff appraiser, or a Staff Appraiser Reviewer (SAR).

The SAR or underwriter may ask for clarifications from the VA appraiser before determining the final appraised home value.

Do I Get a Copy of the Appraisal Report?

Once the appraisal process is complete, you will receive a copy of the VA appraisal report. The document will provide a reasonable estimate of the home value. It will also highlight a list of repairs needed before securing a VA loan.

Unlike homebuyers, sellers are not eligible to receive a copy of the appraisal report. Nevertheless, you can issue a copy to the seller or real estate agent if you wish to do so.

What is a Notice of Value (NOV) in VA Appraisal?

A VA appraisal checks if the home value you want to buy is appropriate and higher than the loan amount you're seeking. The home's value should be more than what you want to borrow for a better chance at a VA loan.

After the appraisal, an underwriter examines the report and issues a Notice of Value (NOV) to the VA, lender, and borrower.

The NOV confirms the home's fair market value and lists the U.S. Department of Veteran Affairs' minimum property requirements that the home must meet.

It may also highlight issues needing resolution, like repairs, termite inspections, or verifying that a condo is VA-approved.

Usually, the NOV aligns with the initial appraisal report. You'll likely get an NOV if the property has no value problems and concerns have been addressed.

Expect to receive the NOV within five business days after the SAR or an approved underwriter reviews the appraisal report.

Why is a Notice of Value in VA Appraisal Important?

A Notice of Value is vital in VA appraisal since it signifies you are about to close the loan. It also provides a reasonable estimate of the home value of the property you intend to buy, so you don’t pay more than its actual worth.

The NOV informs the VA and the lender that you are eligible for a loan if you’ve met all the minimum qualification requirements for a VA loan.

The document verifies the initial VA appraisal report since the reviewer must ask for clarifications and corrections before issuing a Notice of Value to the relevant stakeholders.

The VA and the lender cannot approve your loan application without a Notice of Value. After all, the NOV lists problems that require correcting before closing the loan.

What Happens If a VA Appraisal Has Value Issues?

Sometimes, a VA appraisal may reveal value issues, such as the appraised property value being lower than the proposed loan amount.

This can negatively affect your VA loan application, as the lender will not approve a loan exceeding the home's appraised value.

Solutions to VA Appraisal Value Issues

Renegotiate with the Seller

If the appraisal is lower than the agreed price, try renegotiating with the seller to lower the price to the appraised value.

Providing them with a copy of the appraisal report can help. Sellers who have had their property on the market for a while might be more open to this.

Do a Reconsideration of Value

The VA understands that appraisals can sometimes be inaccurate. You can request a reconsideration of value, especially if your lender and realtor provide comparable sales evidence.

The VA may order a new appraisal if there's proof of recent upgrades or repairs.

Top Up the Price Difference

If the difference between the selling price and the appraised value is small, consider paying the extra amount. This is feasible if the value drop is due to minor repairable issues.

Consult with your real estate agent and lender first, as paying over the appraised value may not be a good investment.

Walk Away from the Contract

If the situation seems unsolvable and you prefer not to pay extra, you can cancel the purchase contract. This is advisable, especially if major issues like safety concerns or structural problems exist.

Note that the VA won't refund the appraisal fee in such cases.

What Are Other VA Appraisal Challenges?

Value issues are not the only concerns when purchasing a home using a VA loan.

Even though a VA appraisal is not a home inspection, it assesses if the home meets the minimum property requirements (MPRs). The VA has various occupancy and property requirements that you must meet to secure a loan.

Here’s what to do if the property does not meet MPR criteria:

Ask the Seller to Make the Necessary Repairs

An appraisal report might recommend various repairs before the loan can close.

You might not secure a VA loan if these demands remain unresolved. Your first option should be to ask the seller to complete the repairs before the purchase can move forward.

However, the seller is under no compulsion to accept your request, but they might be willing to do so if they are desperate to sell the house.

Repair the Home Yourself

If the seller is unwilling to complete the repairs, you can do it yourself, particularly if they do not cost much.

After all, the property will be your primary residence, and it does not hurt if you renovate and repair the home to fit your style and preferences.

Then again, the VA allows borrowers to use their loan money for minor repairs and improvements. However, this provision might vary from one lender to another.

Cancel the Purchase Contract

If everything fails, consider walking away from the purchase. There is no reason to continue dealing with an inflexible seller unwilling to cooperate.

Moreover, if the house has severe defects and damages, repairing it could take a fortune, making it unworthy of your time and money.

Florida VA Appraisal FAQs

Each of these FAQs addresses critical aspects of the VA appraisal process in Florida, providing valuable insights for potential homebuyers using VA loans.

The most asked questions about the VA Appraisal process in Florida:

What is Tidewater in VA Home Appraisal?

The Tidewater Initiative is a specific procedure in VA appraisals, used when the appraised value of a home seems likely to be less than the sale price.

It allows the VA appraiser to request additional information to justify the listed price before finalizing the appraisal.

This initiative provides the realtor or real estate agent a 48-hour window to present evidence supporting the sale price.

The required information from the realtor includes:

  • Comparable sales data.
  • Details of any improvements made to the property.
  • Other relevant market data.

When used effectively, the Tidewater Initiative can enhance the smoothness and efficiency of the VA loan appraisal process.

Additionally, the VA's collateral department reviews all provided comparable sales to assess the property's value accurately.

VA Appraisal Timeline

Usually, a VA appraisal should take between five and 21 business days. However, the timeline depends on the property location, review process, and other factors. Upon submitting the report, you should expect a Notice of Value within five business days.

The VA appraisal process is superior to traditional home appraisals. After all, the primary objective of the VA is to ensure all eligible borrowers become homeowners.

How Does a VA Appraisal Differ from a Standard Appraisal in Florida?

VA appraisals in Florida are specific to VA loans and focus on determining if a property meets the VA's minimum property requirements alongside its market value.

Unlike standard appraisals, VA appraisals are mandatory for VA loans and include a thorough assessment of the property's safety, structural integrity, and sanitation standards.

What Happens if a Property Fails the VA Appraisal in Florida?

Suppose a property fails the VA appraisal due to not meeting minimum property requirements or appraising below the asking price.

In that case, the buyer can request repairs, renegotiate the price, or withdraw their offer. The VA will not approve loans for properties that don't meet their standards.

Can I Challenge a VA Appraisal Result in Florida?

If you believe the VA appraisal undervalued the property or missed key features, you can request a Reconsideration of Value (ROV) through your lender.

This involves submitting new information, such as recent comparable sales or documentation of property improvements.

Are There Any Specific Requirements for Florida Homes in VA Appraisals?

Florida homes in VA appraisals must meet general VA requirements, such as being safe, sanitary, and structurally sound.

Given Florida's climate, additional attention might be paid to flood risk and hurricane resistance.

How Long is a VA Appraisal Valid in Florida?

A VA appraisal in Florida is typically valid for six months. This means the appraisal report can be used for a VA loan transaction within this period from the appraisal date.

Can the Buyer Attend the VA Appraisal in Florida?

Typically, the buyer does not attend a VA appraisal. A VA-certified appraiser carries out the process independently to ensure an unbiased property evaluation.

Bottom Line

Navigating the VA appraisal process in Florida can be a complex but essential step in securing a VA loan in 2024. This guide has highlighted the critical aspects of the process, from understanding what a VA appraisal entails to managing potential challenges.

VA loans offer competitive interest rates and no prepayment penalties, making them an attractive option for eligible borrowers.

However, the unique requirements of a VA appraisal, such as ensuring the property meets specific standards and aligns with the proposed loan amount, are key to the loan approval process.

Understanding the VA appraisal process is crucial whether you're a first-time homebuyer or a real estate agent. This includes recognizing the importance of timely appraisal requests, the role of the VA in selecting appraisers, and strategies for addressing appraisal value issues.

Remember, a VA appraisal not only determines the fair market value of a property but also ensures it meets the U.S. Department of Veteran Affairs' minimum property requirements. This dual focus is designed to protect both the interests of the borrower and the integrity of the VA loan program.

As you embark on your journey to homeownership with a VA loan in Florida, remember these insights to navigate the appraisal process with confidence and clarity.

With over 50 years of mortgage industry experience, we are here to help you achieve the American dream of owning a home. We strive to provide the best education before, during, and after you buy a home. Our advice is based on experience with Phil Ganz and Team closing over One billion dollars and helping countless families.

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