VA Home Loan Property Rules

Appraisal Requirements for an AZ VA Mortgage

VA home loan guidelines for property related requirements are unique.  VA home loans have requirements that a property must meet in order to be eligible for a VA home loan.  VA wants to ensure they are insuring home loans for properties that are safe, sound and secure.

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VA Home Loan Property Guidelines

VA outlines property rules in their Lenders Handbook – VA Pamphlet 26-7 (specifically chapter #12).  While I am sure reading all 23 pages of this one sub-section of the handbook sounds like a blast, let’s condense the info for you and help answer some of the most commonly asked VA property requirement related questions.  

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VA Home Loan – General Space Requirements:

The property being financed must have space for the following:

1. Living
2. Sleeping
3. Cooking and dining accommodations (property must have a stove installed)
4. Sanitary facilities

VA Home Loan – Mechanical Systems:

The property being financed with a VA home loan must have mechanical systems that:

1. Are safe to operate
2. Are protected from destructive elements
3. Have reasonable future utility, durability and economy
4. Have adequate capacity and quality

VA Home Loan – Roofing:

The property being financed with a VA mortgage must have a roof that:

1. Prevents entrance of moisture
2. Provides reasonable future utility, durability, and economy of maintenance

* When a defective roof with 3+ layers of shingles must be replaced, all old shingles must be removed first.

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VA Home Loan – Heat/Air Conditioning:

A property that is being financed using a VA home loan must have:

1. Heating adequate for healthy and comfortable living conditions
*VA maintains separate guidelines for homes with a wood burning stove and Solar systems for domestic water heating and/or space heating 
*VA field stations may determine that climatic conditions are such that mechanical heating is not required

VA does not have a separate set of guidelines for A/C units.  The guidelines only pertain to the heating unit in the home for both FHA and VA.

VA Home Loan – Electricity:

Each unit included in the property being financed with a VA mortgage must have:

1. Electricity for lighting and for necessary equipment

VA Home Loan – Water Supply/Sanitary Facilities:

A property that is being financed with a VA loan must have the following in each unit:

1. Domestic hot water
2. A continuing supply of safe and potable water for drinking and other household uses
3. Sanitary facilities and a safe method of sewage disposal

VA Home Loan – Non-Residential Use:

Any home being financed with a VA home loan must demonstrate that:

1. Any non-residential usage of the property must be subordinate to its residential use and character

If any of the property is used for non-residential purposes, the property is eligible only if the non-residential use does not:
1. Impair the residential character of the property OR
2. Exceed 25% percent of the total floor area (the total non-residential part of the calculation  must include storage areas or similar spaces that are integral parts of the non-residential portion)

VA property guidelines empower the VA appraiser to evaluate the property being appraised objectively.  As you can imagine, different VA appraisers may analyze and appraise the same home in different ways.  This is where frustration in the Arizona Real Estate market stems from with VA appraisals.

Apply for a VA Home Loan today.

VA Home Loan Property Rules:

While the guidelines listed above cover the most general and common questions regarding VA appraisals, there is much more information available on VA’s site.  The Minimum Property Requirements chapter also includes sections for:

1. Proposed construction MPR’s
2. Shared facility MPR’s
3. Access related issues
4. Hazard and defective conditions
5. Fuel pipelines and high voltage electric lines
6. Individual water supply/sewage disposal
7. Community water supply/sewage disposal requirements
8. Manufactured homes classified as real estate

The MPR section of the VA handbook is a great resource.  If you have any questions regarding VA’s minimum property guidelines contact the HOUSE Team.

By Jeremy House

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