The VA loan appraisal process is designed to establish a property's fair market value. The appraiser looks over the home and makes a determination based on the home's condition and how it fits in with the local housing market. But determining the fair value of the home is only part of the process.
The other part of the VA fee appraiser's job is to ensure the properties he or she reviews live up to the VA’s list of minimum property requirements. The appraiser looks for conditions that might make the home unsafe or unlivable.
There are specific VA appraisal requirements for many parts of the home. For example, when the VA-assigned appraiser reviews the basement, the appraiser will look for pools of standing water, leaks, foundation cracks or other issues that could affect the quality of the home. If the appraiser notices pipes wrapped in asbestos, it also goes into the report, as would the presence of any asbestos-based insulation.
When it comes to paint, the appraiser is guided by established VA policy. The VA official site states, "Lead-based paint constitutes an immediate hazard that must be corrected, unless testing shows that lead is not present in the paint at a level above that permitted by law."
The VA-assigned appraiser must assume that "a defective paint condition (involving cracking, scaling, chipping, peeling, or loose paint) on any interior or exterior surface of properties built prior to 1978 involves lead-based paint."
In these situations, the appraiser will make notes about the location and nature of the defective paint condition and recommend corrective action. But it is not a simple matter of noting and logging the condition.
A recommendation for corrective action is also required. "Any defective paint condition identified must receive adequate treatment to prevent the ingestion of contaminated paint."
VA requirements for such corrections include specific instructions on how to proceed. "The surface requiring treatment must be thoroughly washed, scraped, wirebrushed or otherwise cleaned to remove all cracking, scaling, peeling, chipping and loose paint."
The area must be repainted with "two coats of a suitable nonleaded paint.” The VA also requires the lead paint to be "completely removed or the surface covered with a suitable material such as gypsum wallboard, plywood or plaster before any painting is undertaken if the paint film integrity of the surface needing treatment cannot be maintained."
VA rules for lead paint are specific and clear. To be purchased with a VA loan, the property must meet the criteria listed above or be brought into compliance in order to qualify for a VA mortgage.