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Digital / Desktop Home Appraisals for California VA Loans

The home appraisal is an important part of the VA loan process in California. It allows mortgage lenders to assess the current market value of the property being purchased, based on input from an approved home appraiser.

Now, it seems that the VA home appraisal process could be moving in a more modern direction. Legislation introduced into Congress recently would allow VA-approved home appraisers to conduct digital or “desktop” appraisals in California and elsewhere across the U.S.

If approved, this measure could streamline and expedite the property appraisal process associated with VA loans.

Overview of California VA Loan Appraisals

Let’s start with the basic rules. VA loans require a home appraisal. The Department of Veterans Affairs requires a property appraisal for all homes being purchased with a VA-guaranteed mortgage loan.

The appraiser will review the house that’s being purchased and compare it to recent sales in the area. He or she can also look at tax records, Multiple Listing Service (MLS) data, and other sources. The goal is to determine the current market value of the house, and to report that estimated value back to the mortgage lender.

But VA loans aren’t alone in this regard. FHA and conventional (non-government-backed) mortgages can also require home appraisals. In all cases, the primary purpose is the same: to determine the market value of the home being purchased.

A Congressional Push for Digital Home Appraisals

A bill introduced recently within Congress could change this process. Specifically, it would expedite and simplify the VA loan appraisal process in California by allowing for a digital or “desktop” home appraisal. That means the appraiser could assess the market value without leaving his or her desk.

This new legislation (officially named the Improving Access to the VA Home Loan Act of 2022) would allow VA loan appraisers to rely on digital data alone. In other words, they wouldn’t have to visit the home in person as they do now.

The act was introduced by U.S. Senator Dan Sullivan (R-Alaska), a member of the Senate Committee on Veterans’ Affairs; and Congressman Mike Bost (R-Ill.), ranking member of the House Committee on Veterans’ Affairs. It has a ways to go before full approval, but it seems like the kind of legislation that could enjoy bipartisan support.

According to a fact sheet on this proposed legislation:

…veterans using a VA home loan are required to have an in-person appraisal performed by a VA-approved appraiser prior to purchasing their home. However, there are often lengthy wait times for the relatively few VA approved appraisers to become available to perform in-person appraisals. That results in veterans being forced to wait longer to complete the homebuying process and move into their new home than they otherwise would, especially in the increasingly competitive housing market.

The fact sheet pointed out that this change could also reduce closing costs for borrowers who use VA loans. As it explained, “desktop appraisals are faster and less expensive than in-person” evaluations.

Intended to Shorten the Processing Timeline

This would be a positive change from a home buyer’s perspective. If approved, this new legislation could reduce the amount of time it takes to conduct an appraisal for California VA loans.

As we wrote in a previous blog post, the processing timeline for VA loans is very similar to the timeline for conventional mortgage loans. On average, the difference between them is typically only a matter of days.

Even so, anything that might streamline or shorten the process would be a win for home buyers. It could help borrowers using VA loans compete with those who use conventional mortgage financing. And that’s good any way you look at it.

After all, our military servicemembers and veterans deserve a fair shot at housing. They earn VA loan entitlement through their honorable service. So the program should be adjusted as needed to better serve these borrowers.

Have Questions About the Program?

Are you planning to buy a home in California with a VA loan? Do you have questions about how the program works? We’re here for you!

Bridgepoint Funding has been helping California military members and veterans with their mortgage needs for nearly 20 years. We specialize in the VA loan program and are proud to help our deserving clients achieve their homeownership dreams.

Please contact our knowledgeable staff if you have questions about using a VA loan, or if you’d like to start the application process. We look forward to hearing from you.

Mike Trejo

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

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