Gone are the days of $450 appraisals. If an individual wants to purchase a home or refinance, they now have to pay $500 for an appraisal of a property. Alas, the VA could no longer hold off an increase in the VA appraisal fee amid the toxic loans and shrinking market values. As of April 1, 2009, the VA put out an update (26-09-4) which requires our esteemed VA appraiser to include the Fannie Mae Market Conditions Addendum, Form 1004MC, in all VA appraisal reports. Fannie Mae requires appraisers to document an overview of neightborhood market conditions and trends. Fannie Mae has the ability to buy loans from lenders, banks, etc. to keep the flow of money going so lenders have money to do more mortgage loans with the freed up funds. A lender needs to be sure that a loan meets Fannie Mae underwriting guidelines or they could be out of business pretty quickly if Fannie would not buy the loan.

The VA set the rate for the extra time this report takes at $50, which is passed on to the borrower. Appraisers’ jobs are more difficult than ever. Many borrowers are frustrated at the costs of appraisals (people often tell me “the appraiser was only at my house for 30 minutes!”), but what they don’t see are the hours of work behind the scenes. The extra $50 fee is in line with yet more responsibility heaped on the appraisers…this makes a better report for you and ensures that the deserving Veteran will buy the right house at the right price with more in-depth data to support the value. Solid data = a solid purchase, and long-term satisfaction with your purchase!

Feel free to talk with any of us about your VA home loan questions. You will have a great experience working with us. We are Veterans and we are in the business to help Veterans with the most important purchase most of us will ever make.

Michael Frakes, Retired U.S. Navy, Sr. VA Loan Specialist