For those who qualify, a VA loan can be an excellent financing option for buying a home. While these loans offer competitive rates and the ability to purchase a home with no down payment, they also require buyers to meet a specific set of requirements outlined by the U.S. Department of Veterans Affairs (VA). This includes the need for a VA appraisal.
While the terms “appraisal” and “inspection” are often used interchangeably, they are different. A VA appraisal estimates the home’s market value and ensures it meets the minimum property requirements set by the VA.
A home inspection is much more thorough, taking a deep dive into all parts of the home and looking for anything that is currently wrong or could become a problem over the next few years. Home inspections are recommended by the VA but are not required, which may leave you wondering about other home assessments, like radon testing, and whether they are required for VA loans. Here’s what you need to know.
Radon is a radioactive gas that is odorless, invisible and tasteless. It is released by the normal decay of elements in soil and rocks, and can seep up through the ground and infuse into the air. Unfortunately, this gas has been shown to cause lung cancer over time. It’s estimated that radon causes thousands of preventable lung cancer deaths each year. According to the Environmental Protection Agency (EPA), it’s the second-leading cause of cancer in the United States after smoking.
You cannot get a VA loan without an appraisal to ensure that the home you want is safe, sound and sanitary. The VA's minimum property requirements are designed to protect home buyers—but is a radon test required for a VA loan? Let’s take a closer look.
While the VA recommends radon testing, it does not require it for home purchases. However, the rules differ when using a VA loan for new construction. In this case, the home builder must complete a VA radon certification form. This form certifies that the builder meets all state and local building codes for radon control and uses radon-resistant construction techniques.
The need for a radon certification isn’t the only potential roadblock for VA homebuyers looking to build a new home. Since many lenders don’t offer VA construction loans, obtaining VA financing for a new home build is often difficult.
If you choose to have a home tested for radon and the test comes back positive, you may wonder whether you should walk away from the purchase.
While a positive radon test may seem alarming and is certainly something to take seriously, it’s important to note that radon exposure is not acutely harmful. The danger occurs after an extended period of exposure. As long as it’s taken care of quickly, radon in a home does not pose an immediate problem.
Radon mitigation is also a relatively simple and inexpensive process. So, if you really like the home, a positive radon test is not necessarily a deal breaker.
In many cases, you may be able to negotiate with the seller to have the mitigation completed before you purchase the home. Or you can request that the seller reduce the home price by the cost of the mitigation.
A professional radon inspection costs about $500. If the test comes back positive, mitigation services can range anywhere from $500 to $3,000, with the total cost depending on the size and design of the home and the levels of radon detected inside.
While each case will be slightly different, you can expect to pay at least a few hundred dollars to have a qualified radon mitigation contractor remove the radon from the home. When done correctly, radon mitigation can remove up to 99% of the radon in a home, and maintaining the system is easy and inexpensive.
Once a radon mitigation system has been installed, it’s still important to be vigilant. Many experts recommend re-testing every two years to ensure the system is working properly and that other factors haven’t caused significant increases in radon levels. While you’ll want to keep this ongoing obligation in mind before purchasing the home, it’s typically a minor inconvenience that will not significantly impact you over the long term. However, if you plan to make major structural changes to the home, this could impact your system's warranty, so be sure to discuss this with your mitigation contractor.
Ultimately, a radon test is a simple and inexpensive procedure that can give you some extra peace of mind and help protect you and your family. However, since this test is not required to qualify for a VA loan, the decision is entirely up to you.
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