As you shop for a home, you probably have certain requirements in mind. For example, you need a specific number of bedrooms to accommodate your family. Maybe you need a certain type of layout for your family’s comfort. In addition to your requirements, though, the VA has minimum property requirements for those taking out a VA loan. The VA’s requirements, however, do not focus on layouts or even the number of bedrooms. Instead, they focus on the livability and stability of the home.
What are the Minimum Property Requirements?
The following list includes what appraisers look for when they evaluate a home. These requirements are necessary to obtain VA funding:
- Street Access – There must be easy access to and from the home. The street can be private or public. However, either the city or the homeowner’s association must care for it year round.
- Unit Access – The property must have individual access, even if it is located on a property with other units. For instance, if you have to pass through a neighbor’s unit in order to access your unit, it is not eligible.
- Use – The property must be for residential use. There is a small allowance for commercial use, but it must not exceed 25% of the gross area.
- Usability – There must be adequate working facilities in the home. This includes working bathrooms and a kitchen.
- Individual utilities – There must be working utilities in each unit. If there are shared utilities amongst multiple units, there must be an individual shut off valve in each unit.
- Working Mechanical Systems – All mechanical systems must be in good, working condition.
- Heat and Electricity – The heat and electricity must be working and in good condition.
- Water – Each unit must have access to fresh, sanitary water.
- Roof Life – There must be at least five years left on the roof’s life and it must not leak or allow moisture into the home.
- Attics and Crawl Spaces – There must be access to any attic or crawl spaces. They must also be properly ventilated.
- Foundation – The foundation must be in good condition and drain properly.
What Appraisers Look For
The appraiser is the person who determines if the home passes the Minimum Property Requirements set by the VA. What the appraiser needs to see is that the home is safe, clean, and structurally sound. They are not there to decline every home you wish to use with VA financing. They just need to ensure that the home will meet the MPRs set by the VA.
The appraiser is there to ensure that the home will not cause financial issues. For example, if the roof did not have 5 years left, it could leave you with a serious financial debt. If this happens soon after moving into your home, it could put your loan at risk. The same is true for the other MPRs for any home you may buy with VA financing. The VA wants to ensure the home is livable as is without any further investment.
Don’t Overlook the Inspection
Just because the VA appraiser takes a close look at the home does not mean you should forgo the inspection. The appraiser focuses on the livability and stability of the home. The home inspector takes a closer look at certain items in the home. He is the professional who can let you know how safe the home is to move into. The VA does not require a home inspection. However, it is highly recommended in order to ensure the home you purchase is without faults. If the home inspection comes back showing any type of issue, it does not mean your VA loan will be dead in the water. Instead, the inspection is for your peace of mind, helping you understand the status of the home. If it is not in good enough condition, you may be able to back out of the purchase contract. Oftentimes, you can do so without any consequences.
Appealing the MPRs
The VA does allow borrowers to appeal the MPRs if they find a property that does not meet them precisely. Typically, the VA provides exceptions for properties with geographical issues if they don’t meet the MPRs. The buyer must state that they understand the issue and are willing to live with it.
In addition, some areas down South, have homes that have moisture issues. This can come with the territory. Some homebuyers are willing to deal with the dampness because they know it is common for the area. This is another situation where you nust let the VA know that you are aware of the issue. You must also state that you are willing to accept it as a part of the home. The VA will then determine if they are willing to finance the home.
Keep in mind, though, the VA never approves an appeal for properties that are unsanitary or unsafe. There cannot be any defects. If there are small issues, the buyer must address them with the seller. Usually the seller must fix the issues before you can close on the loan. Major issues, however, usually leave you without a VA loan for the property.
The VA puts Minimum Property Requirements in place in order to ensure the safety of you and your family. Not only that, but they want to make sure you can afford the home without financial struggle. If they were to let you purchase a home that needs a new roof within the year, it could put the VA loan at risk for default. If you need to use your money to put a roof on your home, you will likely choose that over paying the mortgage. Without a roof, you wouldn’t have a home to live in. The VA wants to avoid situations such as this, which is why the MPRs are in place. You can look at them as a way to protect you rather than a way to prevent you from securing VA financing.