Selling a home is stressful enough without extra complications. If you’re considering accepting VA loans for your property, you may have heard mixed reviews. VA loans offer great benefits to buyers, but they can sometimes be a bit of a headache for sellers. Let’s break down the pros and cons and potential problems with VA loans for sellers. It’s time to take the guesswork out of working with a VA loan buyer.

What are VA loans, anyway?

VA loans are home loans backed by the U.S. Department of Veterans Affairs. The aim is to make homeownership easier for veterans, service members on active duty, and qualifying surviving spouses. They can utilize this loan type to buy, keep, develop, or renovate a home.

Keep in mind that the government does not directly provide VA home loans. Instead, they are obtained from private lenders such as mortgage firms and banks. These loans offer significant benefits to home buyers, including no down payment and competitive interest rates. However, obtaining a VA home loan does not guarantee that the present owner of the property will accept your offer. The reason is that there might be some problems with VA loans for sellers.

Why are some home sellers wary of VA loans?

Although VA loans offer many perks for buyers, they come with some unique hurdles for sellers. Here’s why some sellers hesitate when a VA loan borrower makes an offer.

The VA appraisal can be a deal-breaker

The VA appraisal process is stricter than those for a conventional mortgage. VA appraisers ensure the home meets the minimum property requirements (MPRs). While this is great for the buyer (who wants a safe, structurally sound home), it can be frustrating for home sellers. If your home doesn’t meet these standards, they may be required to make repairs before closing.

This can be a problem if:

  • You’re selling “as-is property” and don’t want to invest more money in repairs.
  • You have an older home that might not meet modern standards.

The appraiser values your home lower than expected, making negotiations tricky.

VA loan requirements can slow down the loan process

Want to sell a home quickly? A VA purchase loan might not be the best choice. Since VA loan requirements are more stringent, the process can take longer than a conventional mortgage.

This can be frustrating if:

  • You need to move quickly.
  • Are in a competitive market where speed matters.
  • You’ve already lined up another home and need a fast closing.

Remember that home sellers, as well as realtors, prefer quick, uncomplicated house closings. They often think of real estate deals with VA loan buyers as more challenging to close than other types of loans. 

There can be an issue with paying closing costs

VA loans limit what buyers can pay in buyer closing costs. Meaning, the seller often has to chip in. While this isn’t always the case, VA buyers frequently ask sellers to cover costs such as the VA appraisal, title fees, and even some lender fees. If you’re in a hot market with multiple offers, choosing a VA loan buyer might mean walking away with less money.

Not all real estate professionals specialize in VA loans

Many real estate agents don’t fully understand how VA loans work, leading to confusion and frustration. If your agent isn’t well-versed in VA transactions, they may struggle to navigate the VA loan program. This may cause unnecessary delays and miscommunication.

There are misconceptions about VA loan buyers

Some sellers assume that VA loan borrowers have lower credit scores or aren’t as financially stable as those using a conventional mortgage. This is a myth! VA buyers often have solid credit, steady income, and lower debt-to-income ratios (DTI ratio) than other buyers. However, this misconception sometimes leads sellers to favor non-VA offers.

What are the advantages of working with a VA buyer?

Despite challenges, there are some great reasons to consider VA loans for sellers. VA buyers are often serious and motivated. They’re not making lowball offers just for fun. Also, because VA loans require no down payment, VA buyers may have more cash on hand to handle moving expenses and minor repairs themselves.

More importantly, VA loans offer stability, as they have government backing, reducing the risk of financing falling through.

What are the best tips for sellers opting for VA loan transactions?

If you’re open to accepting VA loans but want to avoid the headaches, here’s how to prepare:

  • Work with a real estate agent who specializes in VA loans. They’ll understand the process and can guide you through the details.
  • Get a pre-listing inspection. This can help you identify and fix potential VA appraisal issues in advance.
  • Negotiate wisely. While covering buyer closing costs might seem like a drawback, you can factor this into the purchase price.
  • Be patient. VA loans can take a little longer to close, but they are generally secure and backed by the government.

What is the best way to get VA offers approved, as a buyer?

Once you get the approval for your VA mortgage, you must take proactive steps to ensure that the homeowners and their realtors are more likely to accept your offer.

  • It’s a good idea to shop for homes that are in good condition to avoid lower appraisals. 
  • Keep in mind that the requirements of the U.S. Department of Veterans Affairs are specific to its borrowers. For example, the house must have an adequate roof and a working HVAC system. 
  • Remember that military VA loans have a mandatory escape clause. It states that the home buyer is not required to purchase the house if the VA’s appraisal is less than the asking price. This clause protects the VA members. The buyers might back out if the seller is trying to get a higher number. 
  • Receive a loan preapproval letter before you begin looking for a home because most purchasers are preapproved, and you want to be on the same footing as them.
  • Always work with an agent who has VA borrower experience to navigate through any roadblocks. 

The bright side for VA buyers 

An experienced real estate agent will steer you away from wrong presumptions. Fortunately, the myths are slowly fading away – thanks to social media and better awareness. Towns near military bases generally have agents or mortgage brokers who understand VA loans completely.

The reality is that VA loans may take just a few days more than conventional loans to close. Most importantly, home sellers do not have to pay the closing costs – unless it’s negotiated in such a way between the buyers and sellers. The home appraisal myth is also untrue. 

Today, service members and military families can trade stories about their successful VA loans – with some sharing contact details of reliable realtors or loan lenders who know how to navigate the process of VA loans.

Read more: Guide to VA jumbo loans construction loans

Problems with VA loans for sellers: Last thoughts 

Selling a home to a VA loan buyer shouldn’t be a dealbreaker for you. By understanding VA loan requirements, preparing for the VA appraisal, and working with licensed professionals, you can make the process smoother. While a conventional mortgage might seem easier at first glance, VA buyers bring reliability and strong government-backed financing to the table.

Factor in your timeline, your home’s condition, and your willingness to navigate a few extra steps, before taking the plunge. Remember, working with VA buyers can be just as rewarding as any other real estate transaction.

Problems with VA loans for sellers: What you need to know was last modified: February 3rd, 2025 by Ramona Sinha
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