Policy

Generally, HUD value notices cannot be converted for VA use, since VA is required by law to assign fee appraisers and HUD allows lenders to select appraisers. 

There is one exception.

Exception

To eliminate duplicative efforts and unnecessary appraisal costs for veterans, VA staff will convert a HUD conditional commitment issued by either HUD staff or a Direct Endorsement lender to a VA Certificate of Reasonable Value (CRV) if all of the following requirements are met:

·   The appraiser is

-   a VA fee panel member, and

-   not a staff employee of the lender.

·   The property

-   was appraised as an individual case (that is, not listed on a valid HUD “master” value determination)

-   did not already have a valid VA value determination on the date of the purchase agreement, and

-   was appraised for HUD purposes and the lender documents a legitimate need to change to VA financing after the appraisal was made.  That is, the buyer changed from HUD to VA financing while under contract, or the property is being purchased with VA financing after a contract with a previous buyer requiring HUD financing fell through.

·   The lender submits to the VA office of jurisdiction

-   the lender’s written request for conversion, which includes a certification that identifies the property and addresses each of the above requirements

-   a completed VA Form 26-1805, Request for Determination of Reasonable Value

-   the HUD value notice and

-   the original appraisal report, including photographs and all other addenda.

VA will list applicable VA requirements and conditions on the CRV.