VA Loans and Hazardous Conditions
Everyone who applies for a VA guaranteed home loan hears three things repeated again and again; it’s best to prepare for at least a year before committing to a real estate loan, the appraisal process is one of the most crucial steps in getting loan approval, and the buyer should never rely on that appraisal as a stamp of approval on the home in terms of being defect-free.
Of the three, the last statement is crucial to buyer satisfaction. The VA appraisal is not an exhaustive inspection of the property and the borrower should hire a home inspector to completely look over the property.
In the wealth of material on VA.gov on the home loan process, the Department of Veterans Affairs takes great pains to point out that it cannot guarantee the property even after it’s been appraised. “What can VA not do?” the VA official site says, “Guarantee that a home is free of defects. VA guarantees only the loan. It is your responsibility to assure that you are satisfied with the property being purchased.”
That includes looking into possible hazardous conditions that might go undetected during the appraisal. Anyone concerned about lead paint, asbestos, or radon issues should pay to have them investigated.
A VA appraiser is not necessarily trained in lead paint detection or radon issues. Naturally an appraiser will report any condition he or she detects, but if a condition like lead paint is not detected by the appraiser, the buyer may be unaware too–until the home inspector comes to look over the property.
An appraiser may spot major structural defects and require them to be repaired, but if, for example, a problem with the roof exists but cannot be seen by the appraiser (who is not required to step out onto the rooftop) it may also go undetected until a building inspector has a look.
Hazardous conditions that are evident and noticed by the appraiser are required to be fixed as a condition of the sale, if approved. The buyer’s responsibility starts where the appraiser’s ends. A home inspection may reveal lead paint, radon or other issues–or it may reveal the home is free of such problems. Either way, the buyer makes an informed choice when the home inspection is complete–and that’s the most important part about proceeding with a VA home loan.