source:
  type: guide
  id: va-m26-7-ch10-t09
  authority: VA Lenders Handbook (VA Pamphlet 26-7), Chapter 10, Topic 9 — Properties
    Eligible for an Appraisal
  description: VA Lenders Handbook (VA Pamphlet 26-7), Chapter 10, Topic 9 — Properties
    Eligible for an Appraisal.
  coverage_tier: operative
obligations:
- id: va-m26-7-ch10-t09-full
  canonical_id: va-m26-7-ch10-t09-full
  section: VA Lenders Handbook (VA Pamphlet 26-7), Chapter 10, Topic 9 — Properties
    Eligible for an Appraisal
  type: do
  tags:
  - regulator-direct
  - va
  - va-handbook
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: VA Lenders Handbook (VA Pamphlet 26-7), Chapter 10, Topic 9 — Properties
      Eligible for an Appraisal
    source_class: va-handbook
    source_url: https://www.benefits.va.gov/warms/pam26_7.asp
    snapshot_id: 454f0e7af6f49c3b
    fetched_at: '2026-05-23T01:53:53Z'
    content_hash: sha256:0551eb031df071b1ef69a627ad29b5a2c41dc00e3e2b9ccd421133b2561fa57d
    paragraph_quote: '9. Properties Eligible for an Appraisal Change Date March 11,
      2019 • This chapter has been revised in its entirety. a. Lender’s Responsibility
      While only an extremely small number of residential properties are not eligible
      to be the security for a VA-guaranteed loan, it is the lenders responsibility
      to determine that the property is eligible. If the lender fails to exercise
      due diligence in determining eligibility, VA may deny or reduce payment on a
      future claim based on the ineligibility of the property. This topic covers properties
      that are eligible for an appraisal. b. Existing Construction Properties that
      have been complete for over 1 year based on the certificate of occupancy date,
      and properties that are less than 1-year old that have been previously occupied,
      are eligible for an appraisal. c. New Construction Properties that have not
      been previously occupied and are less than 1-year old based on the certificate
      of occupancy date, and properties which are complete except for customer preference
      items (floor coverings, interior finishings, appliances, fixtures or other equipment)
      are eligible for an appraisal. d. Proposed Construction Proposed and under construction
      properties are processed under the same procedures and include: • properties
      appraised from plans and specifications (see Topic 12 of this chapter), • properties
      appraised from a completed model home (see Topic 13 of this chapter), and •
      manufactured homes to be placed on a permanent foundation (see Chapter 12, Topic
      42 of this Handbook). Continued on next page VA Pamphlet 26-7, Revised Chapter
      10: Appraisal Process 10-16 9. Properties Eligible for an Appraisal, continued
      e. Properties Sold by Lenders Foreclosed or “Real Estate Owned” properties being
      sold by lenders may be eligible, however, properties must still meet VA MPRs.
      Lenders selling their own “Real Estate Owned” properties may not process these
      cases under the Lender Appraisal Processing Program (LAPP). These cases must
      be ordered and processed as Individual (IND) appraisals. A new construction
      property for which a lender acquired title due to a builder’s bankruptcy or
      cessation of business may be eligible (see Topic 20 of this chapter). f. Veteran
      Building Own Home A fully completed home constructed by a Veteran acting as
      a general contractor for his/her own occupancy may be eligible (see Topic 18
      of this chapter). g. New Home Without a Warranty A special exception may be
      granted by VA at the request of a Veteran who is purchasing a newly constructed
      home from a builder who is unwilling to provide the required construction warranty
      (see Topic 19 of this chapter). h. Manufactured Home Classified as Real Estate
      Manufactured homes that are classified as real estate may be eligible (see Chapter
      12, Topic 41 of this Handbook). i. Modular Homes Modular homes, including modular
      on-frame housing, may be eligible (see Chapter 12, Topic 42 of this Handbook).
      j. Condominium Units Condominium units are eligible for appraisal. The development
      must be accepted by VA before the loan is guaranteed (see Chapter 11, Topic
      12 of this Handbook). Continued on next page VA Pamphlet 26-7, Revised Chapter
      10: Appraisal Process 10-17 9. Properties Eligible for an Appraisal, continued
      k. Leaseholds A leasehold estate or any other property involving less than fee
      simple ownership is eligible for appraisal, but must be approved by VA before
      the NOV is issued. VA’s legal staff will review the leasehold documents and
      the RLC will notify the requester of the results of the review. Copies of the
      following documents must be sent to the RLC in order for the leasehold to be
      reviewed for acceptability: • lease identifying the property to be leased, the
      lessor, the lease term, and the rent, • all preceding assignments that may have
      occurred prior to the current assignment, • sales contract, and • in cases of
      age or income restricted leasehold communities, the Veteran-lessee consent statement.
      l. Properties in PUDs Properties located in a Planned Unit Development (PUD)
      are eligible for an appraisal if the lender determines that the title meets
      the requirements specified in Chapter 16 of this Handbook. VA does not maintain
      a list of accepted PUDs. m. Property to be Improved A property to be altered,
      improved or repaired is eligible for an appraisal with the appraisal prepared
      “subject to” the satisfactory completion of the work. The appraiser must be
      provided with construction exhibits, or depending on the nature of the work
      involved, documentation clearly describing the full extent of all work to be
      completed. The appraiser will provide an “as repaired” value. Any work that
      must be inspected upon completion must be approved by the local building authority.
      Continued on next page VA Pamphlet 26-7, Revised Chapter 10: Appraisal Process
      10-18 9. Properties Eligible for an Appraisal, continued n. Special Flood Hazard
      Areas Properties located in a Federal Emergency Management Agency (FEMA) Special
      Flood Hazard Area (SFHA) are eligible for an appraisal if a flood insurance
      policy will be issued unless the area is subject to regular flooding (see Chapter
      12, Topic 8 of this Handbook). o. Security for an Existing VA- Guaranteed Loan
      Properties that are the security for an existing VA-guaranteed loan are eligible
      for an appraisal for the following purposes: • An appraisal may be requested
      for refinancing (see Chapter 6 of this Handbook). • If the VA-guaranteed loan
      is in foreclosure, a liquidation appraisal should be requested at least 30 days
      prior to the estimated sale date. The servicer should confirm arrangements for
      interior access to the property before ordering the appraisal and provide contact
      information for the person who will provide access to the property on the appraisal
      request (see Chapter 11, Topic 20 of this Handbook). • A partial release of
      security may be needed if the borrower requests to have some of the property
      released from the VA-guaranteed loan. VA will assign the appraisal as described
      in Chapter 11, Topic 21 of this Handbook. VA Pamphlet 26-7, Revised Chapter
      10: Appraisal Process 10-19'
  judgment: false
