Unlocking the Mystery of VA Appraisals in Kitsap County WA
May 15th, 2009 by Rich Jacobson“And you will know the truth, and the truth shall set you free.”
John 8:32
Okay, so the topic of VA appraisals here in Kitsap County WA isn’t on quite the same level playing field as Biblical Truth, but the principle is still the same.
One of my marketing catch phrases is ‘providing knowledgeable empowerment’ for my clients. By that, I mean, one of my primary goals is helping to better educate my clients through my years of experience, training, and education as a real estate professional, so as a result, they are more empowered to make intelligent and prudent decisions regarding buying or selling real estate.
As an advocate for my clients, it is my responsibility to educate and inform my clients about the entire real estate transaction process, from start to finish. One of the reasons for doing so is to better prepare them for any potential pitfalls, delays, or challenges that may occur. As much as we may try to achieve a smooth and timely closing, there is always the possibility for a problem to occur that is outside of our ability to control.
Such is the case with VA appraisals.
Here in WA State, most residential real estate contracts require a formal home inspection contingency process. The Buyer contracts with a professional inspector who conducts a full complete home and pest inspection. From the results, the Buyer then petitions the Sellers to repair or remedy any issues of concern. Once the Sellers agree to the terms, the contract then moves along through the ‘Pending’ status onto closing. Usually all that remains is for the Buyer’s loan documents to be sent to the Escrow company.
It is at this point that many people get a false sense of hope/assurance that nothing can go wrong, especially in a VA Loan transaction. One thing I always tell my clients is that nothing is a done deal until your Underwriter ‘funds’ the loan, and the County records the deed. Once those two things happen, you can let your hair down and celebrate. But until then, there is always the chance that something can go sideways, however slight.
In almost every residential real estate transaction, your lender will order up an appraisal of the property to determine that its valuation is closely aligned to the agreed contract sales price.
However, in a VA transaction, the appraiser many times does more than simply determine market valuation. They can also identify potential safety hazards, structural concerns, or other defects, and make them ‘conditions for funding.’ This means that these issues must be resolved/corrected prior to closing. Some of these items may have already been uncovered and negotiated during the inspection. Still others may be in addition to what was handled during the inspection process.
While there is no doubt some standardized procedure to conducting VA appraisals, it’s always interesting (frustrating) to note how each appraiser can vary in their findings. One appraiser will come in at value with no conditions, while another appraiser will call out a long laundry list of ‘conditions for funding.’ At times there seems to be no rhyme or reason to the process.
Unfortunately, there are times when the ‘conditions for funding’ cannot be easily resolved, and the deal falls apart. But in many instances, with both Buyers, Sellers, and agents working together, a remedy can be achieved to satisfy the appraiser’s conditions.
Just knowing that the potential for these kinds of issues exist helps to eliminate any last minute surprises, and can mentally prepare Buyers for the possibility.
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Rich Jacobson is a licensed real estate professional providing knowledgeable empowerment and relentless representation for his clients of residential properties and vacant land throughout all of Kitsap County WA and portions of Pierce, Mason, and Jefferson Counties. You can also find him at KitsapLife.com and Crabbing in the Hood, or e-mail: kitsapagent@gmail.com
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