Change is in the air, and has been for some time. More lenders are getting tighter on their guidelines – and recently many lenders have started requiring some form of an appraisal when doing a California VA streamline refinance.
Recently, some lenders started requiring an appraisal for a VA streamline, something that is completely new to the VA streamline program. It used to be that one of the benefits of the VA streamline program was that you didn’t need an appraisal.
That is still the case with some lenders — some are still not requiring an appraisal — but some are.
To further confuse people, some lenders are now requiring a full blown appraisal, some are only requiring a drive-by appraisal — but the point is that many are now requiring it where before they did not.
As an example, an announcement by Wells Fargo to all correspondent lenders said:
“in an effort to mitigate the risk of declining home values on VA IRRRL transactions on May 18th will require the seller to obtain and deliver a conventional appraisal to Wells Fargo. Please Note: VA has indicated this appraisal should not be submitted to the VA with the guaranty package.”
Does this really make any sense?
I don’t know for sure — but I do know that you shouldn’t be surprised if your loan officer tells you that you now need an appraisal on a VA streamline… and you might want to try to find another loan officer who has access to a lender that doesn’t require an appraisal on a VA streamline.
If you are in the market for a VA streamline and your loan officer is telling you that an appraisal is now required, be sure to ask him if he has access to any other VA lenders – many lenders are still not requiring VA streamlines to have an appraisal.
