“We got a ‘subject to’ appraisal because there was a hole in the vinyl siding,” he said. “And I emailed the VA appraiser. I said, before I go back and ask them to fix this, do you do conventional appraising too? He said, yes. I said, would you call this subject to unconventional? He said, Absolutely, there’s water behind it, it’s going to cause mold and could cause wood rot.”
The process doesn’t end with the appraiser’s judgment either. “And unlike a conventional reconsideration of value, or even FHA, USDA, whatever the appraiser is removed from the scenario, it goes directly to the VA,” he said.
The VA is the only loan program with a built – in early warning for valuation issues – the Tidewater protocol. “With Tidewater, you’re alerted upfront if there may be a problem with the value, so you’re not blindsided later,” Alberico explained.
That dual – review structure gives borrowers an extra layer of accountability – something brokers say should be seen as a value – add.
Lagging volume, lagging understanding
Despite its advantages – no private mortgage insurance (PMI), flexible guidelines, low default rates – VA loan usage has plunged. Only 400,695 VA loans were guaranteed in FY2023, down from more than 1.4 million in FY2021, per VA data.