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Appraisal - VA Cash Out Loan - Ideas?


Phoenix&Ruby

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HI, I was in process of seeking a new VA loan to make needed repairs on my home that I live  (purchased 8 years ago VA-Loan).  VA Appraiser came out last week.  Banker called today to advise that the VA Appraiser had indicated problems with home (stairs and siding).  Banker stated these were "cosmetic"  Loan proceeds were to be used for these repairs.  Is there any remedy in this process for Veteran when appraiser report has these kinds of findings?  Have not received a copy of the appraisal yet - banker indicates we must make repairs or loan will not proceed due to these findings.  Thank you for reviewing.  

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So, I work in construction, and I have to say what is a repair loan if you can't get it to REPAIR your house?  

Since they are requiring these to be fixed for the loan there is not a lot you can do but fix them, but you can ask them to put them into the loan.   Stairs and Siding are not cosmetic.  Cosmetic is painting or plants.  Stairs are the way you get into the house.  Siding protects the house.  

I would suggest giving them a call and see if it can be added into the loan.  

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2 hours ago, Phoenix&Ruby said:

Have not received a copy of the appraisal yet - banker indicates we must make repairs or loan will not proceed due to these findings.

While I haven't addressed these issues specifically, I have found that a mortgage broker who is experienced in VA loans can probably work the loan better than a banker can. I found the rates to be competitive. I found my mortgage broker through the realtor I was working with, and I have to say the mortgage broker went to bat for me.

I live close to a military base and so it's easier to find mortgage brokers that deal with VA loans, serving military retirees or veterans or even the active duty buyers,

I don't think there is a problem with the VA repair loan itself, I think the problem is the banker.  I could be wrong but it appears he's trying to treat it like just a refinance. Perhaps your  banker is doing the "cash-out refinance." 

There appears to be some confusion amongst lenders because the "VA Renovation Loan" is relatively new, as compared to the old way of doing a "cash-out refinance."  See what the differences are here:

https://www.valoans.com/articles/va-loans-for-home-improvements/

The links above says: "This is a new product, and many lenders are hesitant to offer the VA renovation loan for home improvement." 

VA has a help line concerning home loans and I can't remember where I have that number. I'll look for it in my mortgage records. Whenever I had a question about the process the VA helpline for VA loans was able to provide clarity.

It may be just as easy to call 1-800-827-1000 to get transferred to the department that handles the VA loans. 

 

 

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I fully understand "why" you want to do this, but you are probably gonna ultimately need to go another route, but "things have changed".   But, Im far behind on this industry, so I say hang in there, and see if you can get er done.  I really dont know.  

We used to always do "2 loans"...a home equity LOC (heloic) and, later, refinace after work is complete.  (This means double the costs..pay 2 sets closing costs.  Fortunately, Heloic costs are very low or maybe even none.)

Here is the rub (for the lender):  Will you complete the required work, and will it pass inspection, not over budget?  This is the unknown part for the lender.  They dont want you to start fixing the home, then cant finish because the cost were higher than estimates.  (Lumber is crazy expensive now, and many building materials are in short supply).  

Its kinda typical VA:  Why make stuff complicated, when the VA can make it "super complicated" instead?  

Of course, it may work out, but VA does not want to be on the hook for the loan if you/your contractor can not or will not  complete the project.  

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