4 VA Appraisal Dealbreakers (and How to Handle Them)

For Veterans using a VA loan, the appraisal process can feel like an obstacle course. The good news is that most VA appraisal issues are predictable and avoidable. Here's a look at four common pitfalls that can hold up a VA loan and how to handle them.

1. The Leaky Basement

Water can cause an unbelievable amount of damage to a home. Water leads wood to rot, mold to grow and drywall to decay.

That’s why basements and crawl spaces must be dry to garner VA approval. The VA states that any excessive dampness or ponding of water in a home’s crawl space must be corrected, and most appraisers extend that rule to basements as well.

2. The Bad Roof

In the VA’s own words, “the roof covering must

• prevent the entrance of moisture, and
• provide reasonable future utility, durability and economy of maintenance.”

Appraisers have some flexibility in assessing the “reasonable future utility” of a roof. Roofs that are 20 years old won’t automatically lead an appraiser to recommend replacement. Borderline roofs will usually lead an appraiser to call for a professional roof inspection. Gaping holes or missing shingles, however, will probably necessitate repair.

3. Lead-Based Paint

For Veterans buying older homes, lead-based paint is one of the most important VA appraisal issues to understand. Lead-based paint "constitutes an immediate hazard that must be corrected."

For homes built before 1978, VA appraisers must look for defective paint conditions such as cracking, chipping or peeling on the dwelling and assume the presence of lead-based paint. If lead-based paint is noted, the VA requires that these surfaces with loose paint be removed or thoroughly scraped and covered with two coats of non-leaded paint.

It's worth noting that VA lead paint requirements now apply only to the dwelling itself. As of May 1, 2026, defective paint on detached structures, such as garages and sheds, no longer triggers a mandatory repair requirement.

Defective paint on homes built after 1978 is treated as a cosmetic issue only and carries no repair requirement under VA MPRs.

4. Termites

Termite-ridden homes must be treated and re-evaluated for VA loan approval. Termites are pesky little critters that can eat the heart right out of a good deal.

Termite inspections are required in certain areas of the country. And even if a pest inspection isn't required in your state, you'll still have to have an inspection completed if the appraiser finds evidence of termites on the property.

If termites are discovered, the property has to be treated and re-evaluated. The cost of repairs can be covered by either the buyer or seller and is often a point of discussion in negotiations.

What To Do if Repairs Are Ordered

A home that has one (or more) of these problems isn't automatically eliminated from VA loan consideration. A willing seller can make anything possible.

If a home falls short of the VA's Minimum Property Requirements, the appraiser will recommend certain repairs. Those repairs must be completed before a VA loan can close. Some sellers are more agreeable than others, and some repairs are simpler than others. With luck, a seller will complete the repairs necessary to send the VA loan across the finish line. Otherwise, it's time to resume the house hunt.