VA Handbook Chapter 14: Construction Inspections Explained in Plain English

Last reviewed: October 6, 2026
Primary source: VA Pamphlet 26-7 (VA Lenders Handbook), Chapter 14: Construction Inspections. The chapter text carries Change dates of July 14, 2003 (Change 3) for Topics 14.01, 14.02, 14.05, 14.06, and 14.07, and January 1, 2001 for Topics 14.03 and 14.04. This is the oldest material in the handbook series I have published so far, and it shows: the VA compliance-inspection regime this chapter describes was retired by VA in February 2006. I have notated every place where newer VA Circulars superseded the chapter text, so read the amber “Updated since the handbook” boxes as carefully as the chapter itself.

How this post works: We go through Chapter 14 in the VA’s own order, all 7 topics. For each section: what the handbook says (with direct quotes in the blue boxes), what that means in plain English, and where lenders commonly add their own requirements on top. Because this chapter is largely historical for VA-guaranteed loans, the amber callouts carry as much weight as the quotes. They tell you what the inspection process looks like today. The story boxes are illustrations based on situations I see in my pipeline. Names and identifying details are changed, and no story describes any one borrower’s file.

Read this first (the three sentences that matter most)

This chapter describes a VA inspector program that no longer exists for VA-guaranteed loans. In February 2006, VA ceased compliance inspections for new and proposed construction on guaranteed loans, relying instead on local building inspections and construction warranties. If you are building or buying new construction with a VA loan today, your inspection reality is the local building department, your appraiser’s final inspection, and your builder’s warranty, not the three VA inspection stages this chapter walks through.

Topic 1: 14.01 Obtaining an Inspection

What this section says

VA assigned the inspector from its fee inspector roster, with no favoritism or discrimination, usually at the same time the appraiser was assigned. If the appraisal requester did not want the inspector assigned at the same time, the inspector was assigned when VA staff issued the Notice of Value. VA could assign more than one inspector on master appraisals.

The topic also had a workaround for impatient builders. To avoid delaying the start of construction, VA could assign the inspector before the appraiser, if the builder or sponsor submitted a written request that included a statement of understanding of the special nature of the procedure and the fact that inspection fees would be paid whether or not a VA value notice was ever issued, plus construction exhibits properly certified per Section 10.10. Once assigned, the builder contacted the inspector directly to schedule each inspection as each phase of construction was completed. Every compliance inspection was reported on VA Form 26-1839, the Compliance Inspection Report.

What that means

This was the VA version of calling for inspections during a build, except VA chose the inspector from its own roster, not the builder. The builder did the scheduling, phoning the inspector as each construction phase finished. The early-start option mattered to builders because they did not want to sit idle waiting for VA’s appraisal paperwork before pouring a foundation. And note the fee clause: even if the deal died and no value notice was ever issued, the inspection fees were still owed. The early-start request was a commitment, not a reservation you could cancel.

Where lenders add overlays

Today’s equivalent of this topic lives in the lender’s construction-loan program guide, not the handbook. Most lenders running VA construction loans require the builder to be approved by the lender first, and some maintain their own draw-inspection schedules on top of whatever the local building department requires. That is lender policy, not a VA rule. The VA rule in the current framework is only that the inspection requirement must be satisfied through the local authority, the warranty track, or both, per Circular 26-18-7. If your lender demands inspections beyond those options, ask whether the requirement is theirs and what it costs you, because the builder is expected to pay construction fees including inspection fees.

Topic 2: 14.02 Inspection Stages

What this section says

This is the longest topic in the chapter, and it walks through the three stages of VA construction inspections. Before any of that, the first thing the inspector checked at the initial visit was a poster: VA Poster 26-83-1, “Equal Employment Opportunity is the Law.” If the builder had not displayed it prominently, the inspector noted it as a noncompliance item. In areas with significant concentrations of Spanish-speaking people, the Spanish version (26-83-1(S)) had to hang next to the English one. The VA office of jurisdiction would halt all further inspections until the poster was up.

The first stage had two alternatives, chosen by VA per area. The excavation alternative (excavation complete, ready for footings and foundations) applied where the bearing soil should be examined before building, and the inspector looked at the bearing soil itself, the footing forms or trench condition, the structure’s location on the plot, and excavation depth relative to street and finish grades. The foundation alternative (foundation walls complete, ready for backfill) applied where soils were uniform, and added inspection of the size, location, and condition of footings, foundation walls, piers, and other supports, plus the quality of masonry, dampproofing, and foundation drainage workmanship.

The second stage covered the framing and mechanical rough-in: construction below the superstructure not already inspected, quality of materials and workmanship in the superstructure, the floor plan and placement of partitions and openings, and the roughing-in of plumbing, heating, and electrical work, with attention to correct fixture installation, no impairment of structural members, and proper system operation. One carve-out: no second-stage inspection of the dwelling for modular construction, since the unit is factory-built to state standards.

The third stage was the final compliance inspection: acceptable completion of all specified onsite and offsite improvements. The handbook lists the exterior items (compaction of fill, finish grading, drainage, utility connections, walks, drives, accessory buildings, retaining walls, planting, safety provisions at terraces, porches, and areaways, weather protection and moisture penetration, masonry pointing, caulking, paint coverage, flashing, the dwelling’s structural design and installation quality, and the offsite improvements: utilities, storm sewer, drainage channels, grading, curbs, gutters, paving, pavement edging, subgrade, and base and wearing surfaces) and interior items (design, materials and equipment installation, interior surfaces and finish, cabinets and millwork, plumbing, heating, ventilating, and electrical systems and fixtures, hardware quality, tilework, glass, linoleum, and attic and underfloor venting). Where the property had an individual water supply or sewage system, the inspector had to include the builder’s evidence that the installation was satisfactory to the health authority with jurisdiction.

The final inspection generally coincided with the third stage, and the Compliance Inspection Report (VA Form 26-1839) had to include two photographs, preferably from diagonally opposite front and rear corners, to record the dwelling’s appearance and the site’s grading and drainage; describe the condition, suitability, and readiness of all equipment, fixtures, and observable construction; report shortcomings like scratched paint, poorly fitted doors, stuck windows, and cracked walls, regardless of any arrangements made on site for corrections; and confirm that any inferior workmanship, defective materials, faulty installation, or deviation from the approved plans was reported on the form. For units on a master appraisal, the report had to identify any optional variations included or state that none were included.

The topic closes with three enforcement pieces. Special inspections: VA could order them at any stage for unusual site features, unusual construction methods, or builders with frequent complaints. Re-inspection: required whenever an early inspection found noncompliance that would be concealed before the next regular inspection, or for noncompliance or incomplete work found at the third stage, unless the VA field station waived it because the incomplete work was minor and the lender was willing to certify it was satisfactorily completed. Missed inspections: if the builder forgot to call for one, VA could waive it only with a written request signed by both the lender and the veteran, evidence that the local building authority had inspected at the missed stage or stages (with a special note: in areas without local inspections at prescribed stages, the VA inspector had to provide a statement about their experience with the builder’s workmanship and conformity with the exhibits and MPRs), and HUD’s consent if the case was HUD-related.

What that means

Read this topic as the history of how VA used to police construction quality. Stage one checked the ground and the foundation. Stage two checked the bones and the guts: framing, plumbing, wiring, heating. Stage three checked the finished product against the plans and the MPRs. The re-inspection and missed-inspection rules are the interesting part for understanding VA’s priorities: work that would be hidden, like footings and waterproofing, got re-checked if it was wrong, because nobody would ever see it again. And the poster rule tells you something about the era: VA was willing to stop a construction project over a missing equal-opportunity poster.

Where lenders add overlays

Most VA construction lenders today follow the Circular 26-18-7 menu, but some add a belt-and-suspenders layer: they require the appraiser’s final inspection even when a Certificate of Occupancy was already issued. Technically the circular says the final appraisal inspection certifies MPRs and the as-completed value, so this is within the spirit of VA’s rules, but it can add a fee and a scheduling delay you should budget for. Also, watch for lenders that will not accept the local-authority-only track and quietly require the 10-year warranty anyway. That is a lender overlay, not a VA requirement, and the warranty costs real money that is ultimately priced into your build.

Topic 3: 14.03 VA Reliance on Local Building Inspections for First and Second Stages

What this section says

This 2001-era topic was the first step away from full VA inspections. VA waived its first and second stage inspections in every proposed or under-construction case where two conditions were both met: the property was in an area where the local building authority’s inspection procedures were acceptable to HUD for loan insurance purposes, and a third-stage final VA compliance inspection was performed by a VA fee inspector assigned by the VA office of jurisdiction. The provision did not affect other proposed or under-construction VA requirements, and it did not apply to cases involving a VA Specially Adapted Housing grant.

For loans processed under this provision, the lender’s file had to include a properly executed clear third-stage compliance inspection report on VA Form 26-1839 and an occupancy permit or other appropriate locality documentation verifying that all construction was acceptably completed. And VA reserved the right to stop relying on a particular building authority if its staff detected excessive construction deficiencies or construction complaint activity in that authority’s jurisdiction.

What that means

This topic is the bridge between the old world and the new one. Back in 2001, VA said: if the city or county building department is good enough for HUD, it is good enough for the first two inspection stages, but we still want our own inspector at the finish line. The lender’s file had to prove it: the clear final VA inspection report plus the occupancy permit from the locality. And VA kept a quality gate: if a local building department’s jurisdiction started generating complaints, VA could pull the privilege.

Where lenders add overlays

The modern friction point is jurisdiction quality. Some lenders keep an internal list of building departments they trust less, based on their own default or defect experience, and require extra documentation, like the appraiser’s final inspection, in those areas. VA’s own right to discontinue reliance on a particular authority (in this topic) has effectively been privatized into lender policy. If you are building in a rural county or a jurisdiction with a thin building department, ask your lender early whether they accept that authority’s inspections or whether they will require the warranty track. Do not discover this at the final walkthrough.

Illustration based on situations I see in my pipeline.

Topic 4: 14.04 Manufactured Homes Classified as Real Estate

What this section says

Manufactured homes had their own inspection track. First and third (final) inspections were required, to verify that the manufactured home was properly attached to the permanent foundation as specified in the construction exhibits, and that all onsite and offsite improvements were properly completed. Second-stage inspections were generally not required, because the home is factory fabricated. Special inspections could still be ordered as described in Topic 14.02 and as necessitated by other onsite improvements financed with the VA loan.

Used manufactured homes got extra scrutiny. When a used home was moved to the purchaser’s lot to be affixed to a permanent foundation, the lender had to collect additional inspection reports to ensure the dwelling’s safety: a Water-Plumbing Systems Inspection Report (VA Form 26-8731a), an Electrical Systems Inspection Report (VA Form 26-8731b), a Fuel and Heating Systems Inspection Report (VA Form 26-8731c), and a certification that the roof was coated after setup. These reports had to be completed by qualified third-party inspectors, such as experienced plumbers, electricians, heating and air-conditioning contractors, and manufactured home service personnel, after the installation and setup. The roof coating certification could be made by the lender.

On qualifications: inspectors were to perform only inspections they were qualified for, but licensed manufactured home service personnel were permitted to perform any of the required inspections. Lenders had to order the inspections and keep the originals in their loan origination file.

What that means

The logic is straightforward. A manufactured home arrives mostly built, so there is no second-stage framing inspection. What VA cared about was the two things that could go wrong on site: the attachment to the permanent foundation (a manufactured home on blocks is not real estate) and the reconnection of systems for a used home being moved (plumbing, electrical, fuel, heating, and the roof, which takes a beating during transport). The blunt final line is the teeth: fail the inspections, and there is no VA guaranty. Period.

Where lenders add overlays

This is one of the heaviest overlay areas in VA lending, and it is not really about inspections. Most lenders cap the age of manufactured homes (commonly 20 to 30 years from manufacture), restrict or prohibit used homes moved to a new lot, require the home to be on its original permanent foundation in some form, or simply do not lend on manufactured homes at all. VA’s chapter sets an inspection standard. Your lender may have a policy that no inspection can satisfy. If you are considering a manufactured home with a VA loan, the first question is not “what inspections do we need” but “do you do manufactured home VA loans, and what are your age and foundation rules.” Get that answer before you spend a dollar on inspections.

Topic 5: 14.05 Delayed Installation of Appliances and Finished Floor Covering

What this section says

With two exceptions, appliances and finished floor covering could be installed as late as just before loan closing. The exceptions: floor covering in bathrooms and wood finish flooring, which had to be in place for the third-stage inspection. For everything else, the third-stage inspection report had to document the plan: in Section 1, a description of all appliances and finish floor covering to be installed as identified in the specifications (for example, the carpet manufacturer’s name and quality code number) plus the living areas involved if not obvious; and in Section 6, a checked “Prefinal Report Approved” box with a certification that a lender inspection before loan closing would reveal satisfactory installation of the specified items in the specified areas.

What that means

This was a practical compromise. Builders did not want to install carpet and appliances weeks before closing, when tradespeople were still tracking through the house, and buyers often wanted to pick finishes late. VA said: fine, but the final inspection report must spell out exactly what is coming (brand, model, quality code), and the lender must verify before closing that it was actually installed. The bathroom and wood flooring exception is about moisture and protection: wet-area floors and wood floors interact with the structure, so they had to be in place for the inspection itself. And the kicker in the quote above: delaying the installation did not trigger a new value notice. The value stood.

Where lenders add overlays

Many lenders today will not close with appliances or flooring missing, regardless of what this topic allowed, especially on renovation or new-construction loans where the “as-completed” value assumed a finished home. They want the appraiser’s final inspection to show a complete property. That is a lender overlay, and it is driven by the investor or the lender’s own risk team, not by the handbook. If you are buying a home where the builder plans late installation of finishes, confirm with your lender at application whether they will accept the prefinal-and-certify path or whether they require everything installed before the final inspection. The answer changes the builder’s schedule.

Topic 6: 14.06 Lender Use of Inspection Reports

What this section says

This topic is about paperwork flow. When construction was acceptable with no deviations or substitutions, the compliance inspector distributed the report (VA Form 26-1839): if the lender was known, copies went to the lender and the builder, and the inspector kept one. If the lender was not known yet, the builder got two copies, one to forward to the lender when known, and the inspector kept one.

Before closing, the lender was expected to confirm four things from the inspection reports: all VA value notice requirements regarding inspections were met; any deviations or noncompliance items listed on the third-stage report were resolved to VA’s satisfaction; any appliances or floor coverings installed under Topic 14.05 matched what Section 1 of the third-stage report described; and the third-stage report contained everything required for a final inspection. The lender had to retain all inspection-related material in the loan origination file.

What that means

This is the lender’s pre-closing checklist for construction cases. The VA system trusted but verified: the inspector’s report was the record, and the lender was the last checkpoint before the guaranty attached. Notice what the lender is checking against: the value notice’s inspection requirements, not just the inspection report. The NOV could impose conditions the inspection report did not, and the lender had to reconcile the two. The file-retention rule is the paper trail that made VA’s later oversight possible.

Where lenders add overlays

The modern version of this checklist is the lender’s construction-file review, and it is where files get stuck. The most common holdup I see: the final appraisal inspection shows a punch-list item (a missing appliance, an unfinished grade, a downspout not connected), and the lender’s file reviewer treats it as a hard stop while the builder says it will be done by closing. VA’s framework contemplates resolution before closing, not necessarily before the inspection. If your builder has legitimate last-week items, ask your lender what their file reviewer needs to see: dated photos, a re-inspection, or a paid-invoice certification. The requirement to resolve is VA’s. The form of proof is usually the lender’s.

Illustration based on situations I see in my pipeline.

Topic 7: 14.07 Changes to Construction Exhibits

What this section says

The appraisal was based on specific construction exhibits: the plans and specifications. If anything changed after the appraisal, the handbook had a procedure. Who had to ask: if a veteran was under contract, the veteran under contract had to make the written request for any changes. If no veteran was under contract, the builder, lender, or sponsor making the written request had to certify that the property was not under contract to a veteran. The form was VA Form 26-1844, Request for Acceptance of Changes in Approved Drawings and Specifications.

Two exceptions skipped the full form. First: if no veteran-purchaser was involved and the change was limited to substituting mechanical equipment of equal value, the fee inspector could simply check Section 1B (Substitutions or Deviations) on VA Form 26-1839, describe the equipment change and the value attributed to it, and note the change on the plans and specifications. Second: if the property was inspected by HUD, provided the additions, substitutions, or variations were clearly described on the HUD inspection report, the veteran-purchaser signed acceptance of the changes, and the changes were minor with no additional cost to the veteran and no change in reasonable value. The handbook’s examples of minor changes: substitution of a water heater, furnace, hardware, or bath fixtures, and relocation of electrical outlets or windows.

Approval depended on whether value was affected. Changes not affecting property value: fee inspectors could approve and distribute a properly completed Form 26-1844 with all required signatures. The builder completed it in duplicate and had it at the job site at the scheduled inspection. The inspector confirmed the information, inspected per the plans, specifications, and change order, signed the change order, gave the builder the original countersigned copy to forward to the lender, and kept one copy. Changes affecting property value: VA staff had to approve, by issuing an amended NOV. VA noted it would generally take this route when changes also involved NOV conditions, legal requirements, legal descriptions, or plan-type substitutions. For staff-approved changes, VA mailed a copy of the amended NOV to the veteran-purchaser, placed a copy in the VA loan file, and notified the lender that the amended NOV was available through TAS. If no veteran was under contract, the copy was attached to the NOV in the loan file and mailed when a loan application or report came in.

What that means

The value notice was based on a specific house: the one in the plans. Change the house and you may have changed the value. The handbook sorted changes into two buckets. Small stuff with no value impact, documented and signed off at the job site. Anything touching value, back to VA staff for an amended NOV. And the cancellation clause is the enforcement: the acceptance of your changes came with conditions printed on the back of the form, and violating them could undo the approval entirely. The message to builders was: document changes before you build them, not after.

Where lenders add overlays

Modern construction lenders run their own change-order processes on top of this framework, and this is where I see the most friction in today’s builds. Most VA construction lenders require every change order to be approved in writing by the lender before the work is done, and many will not finance the change at all, meaning the veteran pays out of pocket. Circular 26-18-7 confirms that framing: borrowers may pay for change orders out of pocket, and changes made after the appraisal cannot be mortgaged into the loan unless the appraisal is updated. The practical rule for any construction file: never let the builder make a change without a written change order signed by you first. A handshake change that affects value can force a new appraisal, and you will be the one paying for it.

Frequently asked questions

These are the questions Chapter 14 itself answers, plus the one question everyone asks first: does any of this still apply? If your question is about your specific situation, the quiz link above is the fastest way to get an answer.

Does VA still send its own inspectors to construction sites?

Not for standard VA-guaranteed loans. VA ceased compliance inspections for new and proposed construction on guaranteed loans in February 2006, relying instead on local building inspections and construction warranties of 1 or 10 years. This is confirmed in VA Circular 26-25-1 (March 31, 2025), section 2.b. VA still performs compliance inspections for Specially Adapted Housing (SAH) grants and Native American Direct Loans (NADL), where the builder ID requirement also still applies. The fee-inspector roster, the three inspection stages, and the Form 26-1839 reports in this chapter survive only in those narrow programs.

What inspections does VA require on a construction or permanent loan today?

VA Circular 26-18-7 (April 6, 2018), section 5.h, gives three options for cases ordered as “Proposed.” If the local authority performs the required foundation, framing, and final inspections and issues a Certificate of Occupancy or equivalent, VA accepts the CO as evidence. If the local authority performs those inspections but does not issue a CO, VA accepts copies of the inspection reports showing full code compliance or a written statement from the local authority that the inspections were satisfactory. If the local authority does not perform the required inspections, the property must carry a 10-year insured protection plan acceptable to HUD plus a 1-year VA builder’s warranty. When the property is 100 percent complete, the lender contacts the original VA appraiser to complete the VA final inspection, certifying that all MPRs are met, the home was built to the original plans, specifications, and approved change orders, and the as-completed value was maintained.

What were the first, second, and third inspection stages?

The historical system (Topic 14.02): the first stage checked the excavation or the foundation (bearing soil, footings, foundation walls, dampproofing, drainage). The second stage checked the framing and mechanical rough-in (superstructure quality, floor plan, plumbing, heating, and electrical rough-in, with no second-stage dwelling inspection for modular construction since it is factory-built to state standards). The third stage was the final compliance inspection of the finished home, inside and out, against the construction exhibits and the MPRs, documented on VA Form 26-1839 with two photographs. This regime ended for guaranteed loans in February 2006.

Who pays for construction inspections?

The builder. Under the current construction-loan framework, Circular 26-18-7 lists inspection fees among the construction-related fees the builder is responsible for, along with commitment fees, title update fees, and hazard insurance during construction. In the old chapter, the builder also bore the cost: the early-start inspection procedure in Topic 14.01 required a written statement acknowledging that inspection fees would be paid whether or not a VA value notice was ever issued.

What was VA Form 26-1839?

The Compliance Inspection Report: the form on which VA fee inspectors reported every compliance inspection, including the final inspection with its two photographs, the description of the finished construction, any reported shortcomings, and any substitutions or deviations in Section 1B. It is obsolete for VA-guaranteed loans since the 2006 end of compliance inspections. The lender’s file today is built on the local authority’s Certificate of Occupancy or inspection reports, the warranty documents, and the appraiser’s final inspection.

Can appliances or flooring be installed after the final inspection?

Under the old chapter (Topic 14.05), yes: with the exception of bathroom floor covering and wood finish flooring, appliances and finished floor covering could be installed as late as just before closing, under a “prefinal” third-stage report that described exactly what was coming (down to the carpet manufacturer’s name and quality code) and a lender certification that a pre-closing inspection confirmed satisfactory installation. No revised value notice was required. In practice today, many lenders will not close with finishes missing, so confirm your lender’s position at application if the builder plans late installation.

What if the builder changes the plans after the appraisal?

Topic 14.07 required a written change request on VA Form 26-1844, made by the veteran if one was under contract. Minor changes with no value impact (like substituting mechanical equipment of equal value) could be signed off by the fee inspector at the job site. Changes affecting value required VA staff to issue an amended Notice of Value. Violating the Conditions of Acceptance on the back of the form could cancel VA’s approval of the change. Today, your lender’s change-order process controls: get every change in writing and signed by you before the work is done, because changes made after the appraisal cannot be mortgaged into the loan unless the appraisal is updated, per Circular 26-18-7.

Do manufactured homes need VA inspections?

Under Topic 14.04, manufactured homes classified as real estate required first and third (final) inspections to verify proper attachment to the permanent foundation and completion of onsite and offsite improvements, with no second-stage inspection since the home is factory-built. A used manufactured home moved to the purchaser’s lot additionally required plumbing, electrical, and fuel/heating systems inspection reports (Forms 26-8731a, 26-8731b, 26-8731c) plus a roof-coating certification, done by qualified third-party inspectors after setup. The hard rule: no loan on a manufactured home with unsatisfactory inspections was eligible for VA guaranty. Note that most lenders today add their own age caps and foundation rules for manufactured homes, which are lender overlays, not VA rules.

What happened if a required inspection was missed?

Topic 14.02 allowed VA to waive a missed inspection, but the bar was specific: a written request signed by both the lender and the veteran, evidence that the local building authority had inspected at the missed stage or stages, and HUD’s consent for HUD-related cases. In areas without local inspections at prescribed stages, the VA inspector had to provide a statement about their experience with the builder’s workmanship and conformity with the exhibits and MPRs. The underlying principle survives: a skipped inspection needs documented substitute evidence, not a shrug.

Could a loan close with minor incomplete work?

Two paths in the old chapter. A third-stage re-inspection for incomplete work could be waived by the VA field station if the work was minor and the lender was willing to certify it had been satisfactorily completed. And Topic 14.05 allowed appliances and finished floor covering to be installed as late as just before closing under the prefinal-report and lender-certification path. Today, your lender’s file reviewer decides what counts as resolved, so ask what proof they need: dated photos, a re-inspection, or a certification.

Related reading

Chapter 14 is the inspection machinery. These guides cover the rules the inspections enforced and the process around them:

• VA Handbook Chapter 12: Minimum Property Requirements, Explained in Plain English: the MPR standard every construction inspection was measuring the property against. The inspections are gone for guaranteed loans, but the MPRs still apply to every new construction, proposed construction, and existing home.
• VA Handbook Chapter 7: Special Underwriting Situations, Explained in Plain English: covers construction and permanent loans, alteration and repair loans, and the draw and inspection mechanics of renovation financing.
• VA Handbook Chapter 5: Processing VA Loans, Explained in Plain English: how the loan moves through underwriting and closing, including the inspection and warranty documents the lender’s file must contain.
• VA Handbook Chapter 3: The VA Loan and Guaranty, Explained in Plain English: what the guaranty covers and how the Notice of Value, including amended NOVs for construction changes, connects to it.
• VA Handbook Chapter 10: Appraisal Process: the appraisal side of new and proposed construction, including appraisal from plans and specifications and the post-construction inspection by the appraiser. (Post not yet published at the time of writing.)
• VA Handbook Chapter 13: Notices of Value: the NOV forms and conditions for proposed and under-construction properties, including the amended NOV process for approved construction changes. (Post not yet published at the time of writing.)

Sources

• VA Pamphlet 26-7 (VA Lenders Handbook), Chapter 14: Construction Inspections. Chapter text verified against a complete verbatim copy of the official chapter (all 7 topics: 14.01 through 14.07, with Change dates July 14, 2003 for Change 3 topics and January 1, 2001 for Topics 14.03 and 14.04): https://wdiscience.com/wp-content/uploads/2025/05/VA-Pamphlet-26-7-ch10-14.pdf. Corroborated against the docest and docsbay hosted copies of the same chapter. The official chapter title (“Construction Inspections”) and all 7 official topic names come from the chapter’s own overview table.
• VA Circular 26-25-1, “Elimination of Builder Identification Number for Certain Guaranteed Loans and Updates to Builder Complaint Process,” March 31, 2025 (effective immediately): https://www.benefits.va.gov/homeloans/documents/circulars/26-25-01.pdf. Section 2.b confirms VA ceased compliance inspections for new and proposed construction properties secured by VA-guaranteed loans in February 2006, relying instead on local building inspections and construction warranties of 1 or 10 years. This supersedes the fee-inspector assignment system (14.01), the three inspection stages (14.02), the final VA compliance inspection track (14.03), and the Form 26-1839 report chain (14.06) for guaranteed loans; SAH grants and NADL retain VA inspections and the builder ID requirement.
• VA Circular 26-18-7, “VA Construction Loan Policy,” April 6, 2018: https://benefits.va.gov/HOMELOANS/documents/circulars/26_18_7.pdf. Section 5.h sets the current inspection options for cases ordered as “Proposed” (local authority foundation/framing/final inspections with CO, inspection reports, or written local-authority statement; 10-year insured protection plan plus 1-year VA builder’s warranty where the local authority does not inspect; final inspection by the original VA appraiser at 100 percent completion). Section 5.l addresses change orders to plans and specifications (veteran may pay out of pocket; changes after the appraisal cannot be mortgaged into the loan unless the appraisal is updated).
• KnowVA (VA’s official knowledge base) was not used: it is JavaScript-gated and does not yield chapter text to text fetching, so the hosted verbatim copies above were used instead. The copies were complete and mutually consistent on the sections checked.
• Notes on currency: Chapter 14 is the oldest chapter in this series, last revised in 2003, and the February 2006 end of VA compliance inspections for guaranteed loans postdates the chapter without any chapter-level revision. Where the chapter conflicts with the 2018 and 2025 circulars, this article follows the circulars, and the amber boxes mark each conflict. The chapter’s references to HUD consent for waivers (14.02) and HUD inspection reports (14.07) reflect the era when HUD and VA processes overlapped more than they do today; no current circular was found revising those specific provisions, so they are presented as written.

I am a mortgage loan originator, not the VA. This article walks through the VA Lenders Handbook as of the last-reviewed date above, with the newer circulars that superseded parts of this chapter called out in the amber boxes. Story illustrations are based on situations I see in my pipeline, and no story describes any one borrower’s file. Only VA determines program requirements, lender requirements vary, and final approval always depends on the lender underwriting your file.