Part of the VA loans in Arizona guide, where every rule on this page is cited and dated.
Two things make a VA appraisal different from a conventional one. One of them is a reputation problem and the other is an advantage nobody uses.
Minimum property requirements
Like FHA, VA assesses whether the property is safe, structurally sound and sanitary, not only what it is worth. The appraiser is looking at condition as well as value, and items that fail can require correction before the loan funds.
On Arizona housing the recurring ones look much like the FHA list: roof condition and remaining life, peeling paint on older homes, exposed wiring, non-functioning heating or cooling, plumbing leaks, missing handrails, broken windows, pool condition and barriers, evidence of termite damage, and water intrusion or grading that directs water at the foundation.
What is not required, despite the folklore: cosmetic condition, dated finishes, or bringing an older home up to current code. The standard is safety, soundness and sanitation, not taste. A tired but sound house generally passes.
See What an FHA Appraiser Will Make the Seller Fix, because the practical overlap is large and the preparation is identical.
Tidewater, which is the part worth knowing
Here is what VA does that nobody else does.
When a VA appraiser is forming an opinion of value that will come in below the contract price, there is a process by which notice is given before the value is finalised, creating an opportunity to supply additional comparable sales and relevant market data for consideration.
Think about what that means. On a conventional or FHA appraisal, a low value arrives as a finished document and your only recourse is a reconsideration after the fact, which rarely changes anything. On a VA file there is a window before the number is issued.
Three consequences:
Your agent needs to be ready. The window is short and it is for data, not arguments. Sales that are genuinely more comparable, with a reason each is better. Pending sales and relevant market evidence. Documented improvements with dates and costs.
Your lender has to know to act. The notice comes through the lender and the appraisal management chain. An originator who has not closed VA loans may not recognize what they are looking at or may not get the information to the right place in time.
Most listing agents have never heard of it. Which means on a VA offer, having somebody in the transaction who has is worth real money. It is one of the few places in lending where preparation directly changes an outcome.
Ask your lender directly: "If Tidewater comes back on this file, what is your process and how fast do you need comps from my agent?" The answer tells you a great deal about who you are working with.
If the value still comes in low
A Notice of Value below the contract price is not the end. The options look like the ones on any file, with a VA-specific wrinkle:
- The seller reduces to the appraised value.
- The buyer covers the gap in cash, keeping in mind that VA financing is sized on the lower of price or value.
- The parties split it.
- A reconsideration of value is pursued with genuinely better comparable sales.
See When the Appraisal Comes In Low for how gaps get closed generally, and talk to your broker about contract deadlines, which are their lane and not your lender's.
For listing agents taking a VA offer
Most of the risk is removable before you ever receive one.
Walk the property against the condition list. Paint on older homes, handrails, cover plates, the pool, a visibly failing roof. Cheap now, expensive mid-escrow.
Have your comparable sales ready in case Tidewater notice comes back. If you priced the home properly you already did this work; you just need it in a form you can send in a day.
Do not reject VA offers on reputation. A veteran with entitlement, no down payment requirement and no mortgage insurance is frequently a stronger closing risk than a stretched conventional buyer, and the appraisal items are usually a few hundred to a few thousand dollars.
Remember the loan is assumable, which is a selling point for the buyer's eventual exit and a reason the property may trade well later. See Your VA Loan Is Assumable.
Why bring a VA file to us
- We quote the rule and the overlay separately. VA sets the floor. Your lender sets what they will actually do. Those are different numbers and only one of them decides your file.
- Broker model. When a lender's overlay is the obstacle rather than VA's rule, the fix is moving the file, not fixing you.
- We do not treat the VA loan as the fallback. No down payment, no monthly mortgage insurance and an assumable note is the strongest financing available to most buyers who have earned it.
- You talk to the principal. Ricky Khamis is President of EPiQ Lending, NMLS #173141, lending in Arizona since 1999 and a 2025 Presidents Club Winner at CMG Home Loans. Direct line: (480) 999-9842.
EPiQ Lending is NMLS #1936984, at 7975 N. Hayden Road, Suite A-101 in Scottsdale. Verify all of it before you trust any of it: Ricky's EPiQ Lending profile, the Scottsdale branch, and the license itself at NMLS Consumer Access. Hold every lender to that standard, including us.
Send me your Certificate of Eligibility, or let me pull it, and I will tell you what your entitlement actually supports.
Equal Housing Opportunity. This is general information, not a commitment to lend or an offer to extend credit. The VA home loan program is administered by the U.S. Department of Veterans Affairs; loans are made by private lenders, not by the VA, and this site is not endorsed by or affiliated with the VA or any government agency. Eligibility, entitlement, funding fee amounts and exemptions are determined by the VA based on your service record and disability status. Program requirements are set out in the VA Lenders Handbook and change over time, and individual lenders routinely impose requirements stricter than the VA's published minimums. Any figures shown are illustrative, are not a quote, and are not a projection of investment returns. Rental income, property appreciation and refinancing availability are not guaranteed. Rates, terms and program guidelines change and depend on credit approval, property appraisal and other qualifying factors. Not all applicants will qualify. This is not legal, tax or investment advice.
Looking at a specific home? Send me the address and I will run the numbers: rickykhamis.com/analyze
