VA Loan Shocker

I recently tried to re-fi my home to obtain some cash and a lower interest rate. I figured on using my VA benefit for this re-finance since I haven't ever used it. Things went fairly well until the VA appraisal came in. My house was appraised at an amount less than I currently owe. What a shocker. Upon looking at the appraisal forms, I noticed that they used a sales comparability method to calculate my values. When I saw what properties they used, I saw that they used property that was a Sherrif's Tax Sale, and 2 were Auction reposessions. I know I live in a neighborhood that is on the decline, but I really don't think VA was attuned to that, and the appraisor certainly did not do me any favors by rating my house value at half the taxable rate the city uses in determining my property taxes. Thanks so much to the VA,you guys really don't see the big picture.... That's all I'm going to vent...

Big J, the VA does not make the loan, they only guarantee the loan, don't blame them. Your finance company clearly did NOT want to make the loan so they went outside the box to use NON-Legit basis to turn you down. Sad nonetheless.

You might consider contacting the VA about this and asking them if the mortgage company would accept an appraisal by an independent appaiser. Contact several independents and find out what appraisal method they use and if they all use the same method you are out of luck. You would most likely have to pay for the appraisal but it could work in your favor if the basis does not include repos.

Generally, one appraisal can't offset another one for at least 120 days ... and lots of appraisals are now allowed to use foreclosed, repos, and short-sales, which really impacts the value.

BUT, check the loan costs too -- the VA loans are not such the good bargain it once was, as the points to get the low rate have risen much higher now.

Still a good loan, and "0" down, but the costs are up to get it. The federal Credit unions are as good as anyplace if you have one close. In fact, when we were buying a condo, NFCU was less by over $1000 on loan costs although we didn't close on that condo, and eventually went with a different kind of loan.

Am I missing something? What does this have to do with military campgrounds?

Good point - topic was moved to the "Veteran Issues" area.