How do home inspection checklists differ for FHA and VA loan programs?
The FHA or VA appraisal process is intended to protect you from buying a home that needs more maintenance and repairs than you can afford. An appraisal isn’t a replacement for a standard home inspection that will detail the condition of specific systems and what might need maintenance or repair.
Appraisal and inspection requirements for FHA loans
FHA loans may be easier to qualify for because these government-backed loans don’t require a large down payment and are more flexible with credit scores than conventional loans. However, that does mean that the appraisal requirements are usually stricter. In addition to determining the home’s current market value, the appraiser analyzes the property to make sure that your home meets the minimum property requirements and is safe and livable. HUD doesn’t require FHA home inspections.
Only certified FHA appraisers can perform appraisals for FHA loans. According to Homelight, an FHA appraiser’s checklist includes exterior and interior property requirements related to:
- Safety: Protects the occupants’ health and safety
- Security: Protects the property’s security
- Soundness: Ensures the property is structurally sound without problems that compromise its integrity
If the appraiser finds items that make the home unsafe or unlivable, repairs must be made before the FHA loan can move forward. FHA appraisals are valid for 120 days.
Appraisal and inspection requirements for VA loans
VA loans, also known as Veterans Affairs mortgages, offer veterans home loan rates that are lower than traditional mortgages and can allow veterans to borrow up to 100% of the property’s value. After applying for a VA loan and making an offer, a VA-approved appraiser will appraise the home to ensure it meets minimum property requirements (MPRs). According to the U.S. Dept. of Veterans Affairs, MPRs are the legal requirements that veterans must meet before moving into a safe, sound, sanitary home.
The over thirty requirements range from remediating lead-based paint to rules concerning safe year-round access to the home. While the appraisal is required, a VA home inspection is not. However, it’s strongly recommended to check for any major defects before you purchase a home.
Connect with a loan officer for more information on any aspect of the homebuying process.