When purchasing a home using a VA home loan, it’s important to be aware of certain electrical guidelines for the home. The VA sets forth specific property requirements to ensure the house is safe, sound and sanitary. These are in place to protect you as a buyer and the interests of lenders, who also have a stake in the long-term health of your prospective home.
- Functionality: All electrical systems in the home, including outlets, switches and lighting fixtures, must be operational.
- Safety: The electrical system must meet all local and national electrical codes. This includes proper grounding, correct wire sizes for the circuit amperage and safe electrical panel setup.
- Capacity: The electrical system should have sufficient capacity to handle the electrical load of the house. This is especially important in older homes that may not have been designed for today's energy-intensive appliances.
- Wiring: The wiring throughout the house must be in good condition, without any exposed or frayed wires.
- Circuit breakers and fuses: The home should have a modern circuit breaker panel. While a fuse box isn't necessarily a deal-breaker, it could indicate an outdated electrical system that may not meet other VA loan requirements.
It's recommended that borrowers hire a qualified home inspector to thoroughly check the electrical system, among other things, to ensure it meets VA requirements and avoid any unexpected issues after purchasing the property.
VA Loan Minimum Property Requirements (MPRs)
VA minimum property requirements are in place to ensure all homes bought with a VA loan are safe, structurally sound and sanitary for Veterans. Among the various MPRs, there are specific guidelines related to the home's electrical systems. These aim to safeguard the homebuyer from potential electrical hazards and verify the home's electrical system is functional and up to code.
VA Electrical MPRs
The VA appraisal process includes an examination of the home’s electrical system. The appraiser will evaluate the following elements:
- Ground fault circuit interrupter (GFCI) outlets: Appraisers check for the presence of GFCI outlets in specific areas of the home where electricity and water may come into close contact. These areas may include bathrooms, kitchens, garages and outdoor areas. These outlets are designed to cut off electrical power when they detect a ground fault, helping to prevent electrical shocks.
- Fuse boxes and circuit breakers: Appraisers verify the condition and safety of the home's electrical panel. Ideally, the home should have a modern circuit breaker panel. If a fuse box is present in the home, it could indicate an older electrical system that may not meet other VA loan requirements.
- Circuits and outlets: Appraisers ensure there are enough outlets in each room to support modern living requirements. They also check that the circuits are appropriately sized for the electrical load they are expected to carry.
Potential Electrical Problems in Houses
Electrical problems in a home can pose serious risks and inconveniences if left unaddressed. Understanding these issues is crucial for homeowners to ensure the safety and functionality of their electrical systems. Here are some potential electrical problems to look out for:
- Flickering lights: This could indicate a problem with the electrical wiring or circuits in the house. It may be a minor issue such as a loose bulb or switch, but if you notice it happening frequently or in multiple locations, it could point to a more substantial problem like faulty wiring or an overloaded circuit.
- Frayed or exposed wires: This is a significant safety hazard and can lead to electrical fires. Any visible fraying or exposure is cause for concern as wires should be properly insulated.
- Dead outlets or switches: If any outlets or switches in the house don't work, this could indicate a problem with the electrical wiring.
- Frequent circuit breaker trips: This could indicate that the electrical load on a circuit is too high, or it could be a warning sign of a more serious problem, such as a short circuit.
- Old or outdated wiring: Older homes may have outdated wiring systems that are not up to current safety standards. For example, knob-and-tube wiring, which was common in homes built before 1950, is considered unsafe and usually needs to be replaced.
- Lack of GFCI outlets in bathrooms or kitchens: GFCI outlets are designed to protect against electrical shock in areas where water is present. The absence of these in bathrooms, kitchens or other areas near water is a safety concern.
- Aluminum wiring: If the home was built between the 1960s and 1970s, it might have aluminum wiring, which can be a fire hazard. It's generally recommended to replace this with copper wiring.
- Overloaded outlets or extension cords: This is often a sign that there are not enough outlets in the house to safely accommodate all electrical appliances and devices.
- Burn marks or unusual odors: If you notice burn marks around outlets or smell a burning/fishy odor, this could indicate a major electrical problem that may lead to a fire.
If you're unsure about an electrical problem, it's always a good idea to discuss it with your VA lender. If they don’t know the answer, they can properly guide you to someone who does.
Home Inspections for VA Loans
While an appraisal is required for a VA loan, home inspections are not. Home inspections are intended for the homebuyer so they can make a more accurate and informed decision regarding the property being purchased. An inspection typically focuses on details about the home’s condition and possible repairs instead of VA MPRs and market value.
Even though a home inspection is not mandatory for VA loans, it can reveal critical electrical information the VA appraisal overlooked. Most findings from a home inspection can be used to ask the seller to do the problematic repairs or renegotiate the purchase price.