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Do California VA Loans Require a Home Inspection for Purchases?

First-time home buyers who are considering the VA loan program tend to have a lot of questions about how the program works, the minimum requirements, etc. Today, we’ll address one of those common questions:

In California, do VA loans require a full home inspection, or just an appraisal?

Let’s start with the short answer, before digging into the details of this program.

A standard home inspection is usually not required for VA loans in California. The official guidelines do require a property appraisal, which is used to determine the home’s market value. And the appraisal does have some inspection procedures built into it. But it’s not the same as a full home inspection, which is optional.

Home Inspection Not Required for California VA Loans

The VA loan program works differently from a “regular” mortgage program. Through this program, eligible home buyers can buy a house in California with no money down. That’s because the federal government partially guarantees the loan against default.

But the Department of Veterans Affairs (VA) does not actually lend money to borrowers. The funding comes from a mortgage lender in the private sector, as with other types of home loans. The VA just provides the guarantee. They also establish most of the rules associated with this program.

One of those rules has to do with home appraisals and minimum property requirements. Here’s the gist of it:

  • The VA does not require borrowers to have a home inspection.
  • But they do require a property appraisal to be performed.
  • The appraisal is used to determine the current market value of the house.
  • The appraiser will also inspect the house to ensure minimum property requirements.

But it’s important to understand the difference between a full home inspection (i.e., the kind you would get by hiring an inspector yourself) and the partial inspection that’s built into the VA home appraisal. They’re two separate procedures.

Here’s how the Department of Veterans Affairs explains the difference, in Chapter 12 of VA Pamphlet 26-7:

“While VA-assigned fee appraisers must note any readily apparent repairs that are needed, it is important to distinguish the differences between a real estate appraisal and a home inspection report. The fee appraiser will not perform operational checks of mechanical systems or appliances. The fee appraiser estimates the value of the property to ensure that it is sufficient for the amount of the proposed loan.”

Generally speaking, the basic inspection performed by the VA-assigned property appraiser is less detailed when compared to a traditional home inspection. In the context of California VA loans, the appraiser is mostly concerned with health and safety issues as outlined in the official guidelines. But he or she won’t go through the house with a “fine-tooth comb,” the way a regular home inspector would do.

Looking Out for Your Own Interests

Even though the government doesn’t require home inspections for VA loans in California, you might want to consider getting one anyway. The appraiser essentially works for the VA and/or the lender, but not the borrower. But when you hire a home inspector, he or she will be working for you, the buyer.

The inspector will review every aspect of the house, looking for issues, problems and discrepancies. The inspector will examine the home’s plumbing system, the electrical, the roof and foundation, heating and cooling, etc. He or she will make a detailed list of findings and review them with you, after the inspection.

This process will help you, the buyer, identify any issues you might not be comfortable with. For instance, if the house has serious structural or foundation problems, you would obviously want to know about them before purchasing. The VA appraiser might not catch these types of issues — but an inspector probably would. It’s something to think about.

Summary of Key Points

This can be a confusing subject, especially for first-time buyers. So let’s wrap things up with a quick summary of the key takeaway points:

  • In California, home inspections are not required for VA loans.
  • But the government does require a home appraisal for VA purchase loans.
  • The appraiser will determine the current market value of the house.
  • He or she will also perform a basic inspection, as required by the VA.
  • As the buyer, you have the right to hire a third-party home inspector.
  • A more detailed inspection could give you better insight into the home’s condition.

Have questions? Bridgepoint Funding specializes in California VA loans and serves borrowers all across the Golden State. We can answer any questions you have about this program and help you determine the best financing method for your situation. Please contact us for more information.

Mike Trejo

Mike Trejo is a Bay Area mortgage broker with 20+ years of knowledge and experience.

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