2/16/2024

VA Appraisal



Can Lenders Take the Wheel? Devolving VA Appraiser Panel Management for Faster Veteran Homeownership

Homeownership remains a dream for many veterans, but navigating the VA loan process can be frustratingly slow, often due to the unique way the Veterans Administration (VA) manages its appraiser panels. Unlike conventional mortgages and other government-backed programs, lenders lack direct access to appraisers approved for VA loans, creating a bottleneck that delays closings and weakens veteran offers in competitive markets.

Proponents of change argue that devolving VA appraiser panel management to lenders could significantly speed up the process, making VA-backed offers more competitive. Here's why:

Current Challenges:

  • Limited Choice: The VA directly manages a nationwide panel of appraisers, often leading to limited options in specific regions or property types. This can result in longer wait times and potentially higher fees for both veterans and lenders.
  • Lack of Flexibility: Lenders lack the ability to proactively engage with appraisers familiar with their local market, potentially affecting the accuracy and efficiency of the appraisal process.
  • Competitive Disadvantage: Delays associated with VA appraiser assignments can put veteran offers at a disadvantage in fast-paced markets, leading to lost opportunities.

Potential Benefits of Change:

  • Increased Efficiency: By allowing lenders to manage their own VA appraiser panels, veterans could benefit from quicker turnaround times and potentially lower appraisal fees due to increased competition.
  • Improved Expertise: Lenders could select appraisers with specific expertise in local market conditions and property types, potentially leading to more accurate and reliable valuations.
  • Enhanced Competitiveness: Faster closings would put VA-backed offers on par with conventional offers, allowing veterans to compete more effectively in hot markets.

Addressing Concerns:

While concerns exist about maintaining quality standards and preventing conflicts of interest, these can be mitigated with proper safeguards:

  • VA-approved qualifications: Appraisers on lender panels would still need to meet stringent VA requirements and undergo regular performance reviews.
  • Transparency and oversight: Mechanisms could be established to ensure transparency in appraiser selection and prevent collusion between lenders and appraisers.

The Path Forward:

A collaborative effort involving the VA, lenders, and veteran advocacy groups is necessary to explore the feasibility and implementation of this reform. Pilot programs could be conducted to test the effectiveness of lender-managed appraiser panels while ensuring fair and accurate valuations.

Ultimately, empowering lenders to manage VA appraiser panels could hold the key to unlocking faster and more efficient homeownership for veterans. This potential reform deserves serious consideration to ensure veterans have every opportunity to achieve their homeownership dreams. Listing agents and sellers frown at VA offers because the appraisal takes double the turn time. This is a disservice to veterans.