What Are The Minimum Property Requirements For A VA Home Loan?

What Are The Minimum Property Requirements For A VA Home Loan?

Minimum Property Requirements (MPRs) For A VA Home Loan
MPR’s

VA has established Minimum Property Requirements (MPRs) to protect the
interests of Veterans, lenders, servicers, and VA. Properties must meet these
requirements prior to guaranty of the loan by VA.

APPRAISAL IS NOT A HOME INSPECTION
While VA-assigned fee appraisers must note any readily apparent repairs that
are needed, it is important to distinguish the differences between a real estate
appraisal and a home inspection report. The fee appraiser will not perform
operational checks of mechanical systems or appliances. The fee appraiser
estimates the value of the property to ensure that it is sufficient for the amount
of the proposed loan. It is always recommended to order an inspection so you are aware of any deficiencies and potential costs to repair mechanicals once you close.

MPR’s ENSURE THE PROPERTY IS SAFE, SECURE AND SANITARY

MPRs help ensure that the property is safe, structurally sound, and sanitary.
The scope of MPRs also includes issues related to the property’s location and
legal considerations

APPRAISAL SUBJECT TO REPAIRS TO MEET MPR’s
The appraiser will prepare origination appraisals “subject to” the completion
of any MPR repairs that appear to be needed and include the contributory value of the completed repairs in the estimated market value. Liquidation appraisals are prepared “as-is”.

HOME INSPECTION RECOMMENDED
After an origination appraisal is completed, the Notice of Value (NOV) that is
issued to the Veteran includes a recommendation that the Veteran may wish to
obtain a home inspection.  Information about MPRs concerning properties in specific locations are listed by state at http://www.benefits.va.gov/HOMELOANS/appraiser_cv_local_req.asp.

SPACE REQUIREMENTS
Each living unit must have sufficient space for:
• living,
• sleeping,
• cooking and dining, and
• sanitary facilities.
Non-standard house styles which may be unique in a market area, for example,
log houses, earth sheltered houses, dome houses, and houses with lower than
normal ceiling heights, must meet any local building codes. The appraiser
must consider the marketability of the home in the appraisal.

BACKYARD ACCESS
Access to the backyard must be provided without passing through any other living unit. For a row-type dwelling, the access may be by means of • an alley, • easement, or • passing through the subject dwelling.

NON Residential USE
A property that has both a residential and business use may be eligible for loan guaranty if: • the property is primarily for residential use, • the non-residential use does not impair the residential character, • the property contains no more than one business unit, and • the property is legally permitted and conforms to current zoning, or is a legal, non-conforming use that is accepted by the local authority.

UTILITY REQUREMENTS  FOR VA HOME LOAN
Each living unit must have electricity for lighting and for necessary
equipment.  Any visible frayed or exposed electrical wires must be repaired.
Utility services must be independent for each living unit, except • units in a two to four-unit property may share water, sewer, gas, or electricity as long as there are separate service shut-offs for each unit, and • units under separate ownership may share connections from the main to the building line when those connections are protected by an easement and a maintenance agreement acceptable to VA.

WATER SUPPLY AND SANITARY FACILITIES
The property must have:
• a continuous supply of safe and potable water for drinking, bathing,
showering and sanitary uses,
• hot water,
• sanitary facilities, and
• a safe method of sewage disposal
Given the importance of safe drinking water, appraisers must ensure that accurate water supply information is reported in the appraisal and the Staff Appraisal Reviewer (SAR) must condition the NOV appropriately. If the appraiser is aware of any issues regarding the water supply, the appraiser must comment in the appraisal

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WATER SUPPLY AND SANITARY FACILITIES

Conditions which impair the safety, sanitation, or structural soundness of the
dwelling will cause the property to be unacceptable until the defects or
conditions have been remedied and the probability of further damage
eliminated. The integrity of the envelope of the structure must not be
compromised

Examples of defective conditions include: • defective construction, • poor workmanship, • evidence of continuing settlement, • excessive dampness, • leakage, • decay, and • termites

VA HOME LOAN MINIMUM PROPERTY REQUIREMENTS CONTINUED

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