VA Appraisal Fees: What To Expect

Are you a military veteran or surviving spouse searching for the best possible deal on a home mortgage? A VA loans is one of the best ways to get a low-cost mortgage, even without perfect credit or a down payment. However, there is one crucial step in receiving a VA loan that you may not be familiar with, especially if you are a first-time home buyer or only have experience with conventional mortgages.

VA appraisal fees are a mandatory part of the VA appraisal process and are essential to determine whether your desired home meets the VA’s minimum property requirements and is eligible for a VA loan. As more veterans take advantage of this enticing benefit, the fees and the timeline for completing the appraisals have increased in certain high-demand areas. Follow along below to learn more about VA appraisal fees and see if your area is affected by this increase in demand.

Home buyers pay VA appraisal fees to an appraiser to assess whether a home qualifies for a mortgage loan backed by the Department of Veterans Affairs, known as a VA loan. The VA appraisal process has two main functions: to assess a home's fair market value and ensure the home's condition is safe for the homeowner to live in. The home's living condition is based on the VA's minimum property requirements. The requirements include but are not limited to the following:

• How much living space the home provides.
• Whether there are hazards or pests that could damage the house.
• Whether the home's structure is sound. 

While a VA appraisal is similar to a home inspection in some respects, home inspections do not have minimum property requirements and are not mandatory to receive a VA loan or conventional loan. A VA appraisal is not as extensive as a complete home inspection but is required to obtain a VA loan.

The VA appraisal process usually begins once you are under contract to purchase a home. Your lender will submit a request for an appraisal to the VA, which will assign an approved appraiser to assess the home. While the turnaround time for an appraisal is typically within 10 business days, the timeline differs between states and localities (more on that below). It is essential for your lender to begin the scheduling process as soon as possible after your home is under contract in case there are delays in the process or the home requires repairs before the loan is approved.

While the lender is responsible for ordering the appraisal, the buyer is responsible for paying the VA appraisal fee upfront unless they negotiate with the seller to cover it. You can expect to pay around $600 or more for a VA appraisal fee, which differs depending on the home's location. The cost will also vary based on whether the property is a single-family home, individual condo, manufactured home, or 2- to 4-unit multifamily home. 

Additional Fees

While the fees mentioned above represent the flat rate charged for a VA appraisal fee, home buyers may be responsible for additional fees. If approved by the VA, appraisers can charge mileage fees to cover travel expenses to reach the property. Appraisers may also charge other travel expenses for properties in especially hard-to-reach areas, such as Hawaii, Alaska, or island territories.

If a property fails to meet the requirements for a VA loan after an initial appraisal, a seller may conduct repairs to meet the requirements. Once the seller completes the repairs, the appraiser can charge an additional $150 to reinspect the property. Appraisers can also charge an additional $50 fee if a property is proposed or under construction.

According to the VA, requests for appraisal services have recently increased to an unprecedented level, leading the agency to adjust VA appraisal costs and the timeline for their completion. In certain high-demand areas, appraisers can charge increased rates and have more time to complete their appraisal reports. These increases may not be permanent and are subject to adjustment based on market demand and the availability of appraisers in high-demand areas.

High Demand Counties

The high-demand counties that are subject to increased VA appraisal fees and longer timelines can be found on the VA's website. Many of these areas are rural counties with a small number of approved VA appraisers and long travel times between homes, making it harder to complete appraisal reports on time.

If a lender must cancel a VA appraisal, they are responsible for notifying the assigned appraiser and the VA. The VA determines the amount the buyer must pay for a canceled appraisal based on the time and work the appraiser put into the project. The VA set the schedule below:

• The appraiser can charge no more than $50 if the VA assigned the appraiser to assess a property but had not set the appointment date at the time of cancellation.
• The appraiser can charge no more than $175 if the appointment is canceled after the appointment date was set.
• The appraiser can charge no more than 50% of the assigned appraisal fee if they completed the property assessment but did not complete the appraisal report.
• The appraiser can charge the total assigned appraisal fee if they fully complete the appraisal report and upload it to the VA website portal.

VA appraisal fees are mandatory for military veterans or surviving spouses to obtain a VA loan. While they are similar in some ways to a home inspection, you should keep in mind that they are not as extensive and full home inspections are always recommended. The main functions of VA appraisals are to determine a home’s fair market value and to ensure the home is in a safe living condition for the buyer.

VA appraisal fees and the timeline for an appraisal's completion differ depending on the home’s location, but you can expect to pay around $600. Due to a recent increase in demand for VA appraisals, the VA increased the fees and timelines for appraisals. Make sure to check the VA’s website to see if you live in a high demand county affected by the rate increases.

If you are ready to qualify for a VA loan, start the mortgage approval process with Rocket Mortgage^® today!