VA appraisals

Reader Question: VA Loan Appraisals and Unfinished Rooms

October 16, 2018

Reader Question: VA Loan Appraisals and Unfinished Rooms

A reader asks about a previously owned home up for sale with some work missing. “…(T)he last owner left the master bathroom unfinished, floor and wall tiles missing, sink, cabinet and toilet not installed but everything is in a closet including the tiles.”

“It is an approved short sale for less than the comparables, the bank will not do any repairs and will not let me because of liabilities.”

Will the VA inspector see a problem even if the house has 2 more bathrooms?”

It’s tough to answer a question like this for several reasons–one of which being that while there are VA loan minimum property requirements (MPRs), local building codes must be enforced where applicable.

VA MPRs require a home to have dedicated cooking, living and sanitary areas, and a three-bathroom home with one bathroom unfinished might technically still be in compliance with VA standards. But local building codes may have something different to say, and that’s the part we simply can’t answer–the local authority would have the final say in this situation as described here.

Homes that violate VA minimum property requirements are not always rejected for a VA loan–the appraiser may make recommendations for corrections, repairs, etc. as a condition of loan approval. In such cases the fixes must be made to the satisfaction of the MPRs or local codes as described in the appraisal report so the loan can move forward.

When in doubt about a specific condition that could affect the VA loan, borrowers can ask the lender what has traditionally happened in similar circumstances, but it’s important to keep in mind that the VA appraiser will review each home on an individual basis. What applies in one scenario may not apply in the next.

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2 Comments
  1. michael sauer

    https://www.redfin.com/WA/Tacoma/1040-S-Trafton-St-98405/home/2904810 I'm a disabled Veteran and USAA has approved me up to $270,000 on a VA loan..will the unfinished basement be an issue to qualify for this house? Thanks, Mike

    • Joe Wallace

      The unfinished basement issue might depend on state or local building code--you would need to consult the local authority to learn what requirements may apply.

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