Who Pays for VA Appraisals?

Experienced house hunters know they’ll be required to pay certain fees and expenses which are typical of the home buying experience. Those expenses include paying for a VA assigned fee appraiser to look over the property an applicant wants to buy.

Unfortunately the appraisal is sometimes not a one-step process--the appraiser may find areas which need correction or repairs. These must be addressed to the satisfaction of the VA before the loan is closed or within a reasonable amount of time as described in VA regulations.

When these corrections or fixes are required, the appraiser may order a compliance inspection to happen at a later date to insure any issues are indeed corrected.

If you’re new to the VA loan process, you’ll learn you must pay both the initial appraisal and any required compliance inspection. The borrower is also required to pay if a second appraisal or a reconsideration of value is ordered. Such expenses are one reason it’s best to prepare early for a VA loan--budgeting for these costs is crucial.

But there are some costs the VA loan applicant should not have to pay for according to VA home loan rules.

The VA borrower cannot be required to pay for appraisals requested by a third party. The borrower and the lender may request an appraisal, but if the seller or any other third party wanted an appraisal it would have to be paid for by the person or company making the request--that expense cannot be passed on to the borrower.

That includes situations where the lender or the seller wants a reconsideration of value. It’s perfectly acceptable under VA rules for the buyer to request a new appraisal and agree to pay for it; it is not permitted to charge the borrower if the lender or seller wants this work done. VA loan regulations forbid this, simply stating “The veteran cannot pay for an appraisal requested by the lender or seller for reconsideration of value.”

This rule is designed for a variety of reasons which include preventing arbitrary requests for re-appraisal simply because the borrower, lender, or seller may disagree with the results of the original review of the property. (The VA handles requests to re-value a home on a case-by-case basis only.)

Additionally, the borrower must not be charged for services not actually rendered, whether they are appraisals, re-appraisals, flood zone determination or any other instance where money is paid for a service to be completed. The borrower must get value for the services he or she pays for in connection with a VA home loan