VA vs. Conventional Property Requirements: Which Repairs Are Actually Required?
Last reviewed September 17, 2026
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Short answer: on a VA loan a repair is required when the condition breaks a Minimum Property Requirement, meaning safety, structural soundness or sanitation. On a Fannie Mae conventional loan it is required when the condition affects safety, soundness or structural integrity. Those tests overlap far more than the internet suggests, and neither program cares about ugly.
I am Carlos Scarpero, a mortgage loan originator with Edge Home Finance. Below I walk the same defect through both rule books, with the Chapter 12 Topic and the Selling Guide section next to each answer.
On this page
- Which repairs are actually required on a VA loan?
- What does Fannie Mae require on a conventional loan?
- VA vs. conventional: the same defect, side by side
- How is cosmetic damage treated under each program?
- How are roof, water and structural problems treated?
- What changed for utilities, sheds, heaters and radon in 2026?
- The House Doesn’t Meet VA MPRs. Should You Switch to Conventional?
- Common questions about repair requirements
Which repairs are actually required on a VA loan?
Only when the house fails an MPR. MPRs exist so the property is safe, structurally sound and sanitary, and they also cover location and legal issues like access and flood zones (Topic 1c). The part most people skip is Topic 1f, where VA tells appraisers to leave cosmetic items alone.
VA HANDBOOK EXCERPT
“The appraiser should not recommend repairs of cosmetic items, items involving minor deferred maintenance or normal wear and tear, or items that are inconsequential in relation to the overall condition of the property.”
Worn carpet and a dated kitchen are not MPR failures. Full detail is in my complete VA MPR guide.
Source: VA Lender’s Handbook (Pamphlet 26-7) – Chapter 12: Minimum Property Requirement, Topic 1
When something does break an MPR, VA asks for a repair rather than an inspection, and the appraisal is written subject to it with the value of the finished work included (Topic 1d, 1e). Topic 21a is the test: conditions which impair safety, sanitation or structural soundness make the property unacceptable until remedied.
A VA appraisal is also not a home inspection (Topic 1b), so get your own inspector.
What does Fannie Mae require on a conventional loan?
Fannie Mae runs on condition ratings C1 through C6 plus one test: does the condition affect safety, soundness or structural integrity. Minor items can stay, and the guide names them.
B4-1.3-06, Property Condition and Quality of Construction of the Improvements
“While such conditions generally do not rise to the level of a required repair, they must be reported. Examples of minor conditions and deferred maintenance include worn floor finishes or carpet, minor plumbing leaks, holes in window screens, missing handrails, or cracked window glass.”
Note the word generally. Items like these usually do not rise to a required repair, but they still get reported and priced into value.
Then the hard stop. A C6 means deficiencies severe enough to affect safety, soundness or structural integrity. B4-1.3-06 requires the appraisal to be completed subject to completion of those items with a minimum resulting rating of C5, so a C6 house is not financeable as it sits.
B4-1.2-05 then names the defects that force a subject-to-repair appraisal: foundation settlement, water seepage, active roof leaks, worn roof shingles, and inadequate electrical service or plumbing. That is where the strict-versus-easy argument falls apart.
VA vs. conventional: the same defect, side by side
Read the row, not the program name. Topic numbers and section IDs are in the cells.
| Condition | VA (Chapter 12, effective after May 1, 2026) | Fannie Mae conventional (Selling Guide) |
|---|---|---|
| Defective paint, built 1978 or later | Normally cosmetic (Topic 32a). | No paint section. Safety and soundness test (B4-1.3-06). |
| Defective paint, built before 1978 | Lead paint presumed, defective paint must be remediated and certified (Topic 32b, c, d). | No paint section. Lead paint is a hazardous condition to be noted (B4-1.4-08). |
| Missing or damaged handrails | No handrail Topic, no step count. Hazard (Topic 20a) or cosmetic (Topic 1f). | Listed as a minor condition (B4-1.3-06). |
| Cracked window glass, torn screens | No Topic on glass. Hazard (Topic 20a) or cosmetic (Topic 1f). | Listed as minor conditions (B4-1.3-06). |
| Roof damage, active leaks | Must prevent entrance of moisture, reasonable future utility (Topic 26a). | Active leaks and worn shingles force repairs (B4-1.2-05). |
| Water intrusion, dampness, mold concerns | Excessive dampness and leakage are defective conditions (Topic 21c, 28d). | Water seepage forces repairs (B4-1.2-05). Dampness needs a report (B4-1.3-06). |
| Foundation cracks, settlement | Step cracks mean licensed repair, common hairline cracks usually do not (Topic 7d, 7e). | Foundation settlement forces repairs (B4-1.2-05). Abnormal settlement needs a report. |
| Termites, insects, dry rot | Apparent evidence means inspection and all damage repaired (Topic 33a, 33b). | Infestation needs correction or a report showing no structural threat (B4-1.3-06). |
| Utilities and major systems | Frayed wiring repaired, safe water, permanent heat at 50 degrees (Topics 14, 15, 23a). | Inadequate electrical service or plumbing fixtures force repairs (B4-1.2-05). |
| Flooring and cosmetic deferred maintenance | Not written up as repairs (Topic 1f). | Worn floor finishes or carpet stay as-is (B4-1.3-06). |
| Detached sheds and outbuildings | Detached Improvements subtopic removed from Topic 1 in 2026. Hazard rules apply (Topic 20). | Rated holistically with the improvements (B4-1.3-06). |
| Non-vented heaters and fireplaces | Non-Vented Heater subtopic removed from Topic 23 in 2026. Systems must be safe (Topic 22a). | No dedicated section. Condition rating (B4-1.3-06). |
| Radon | Removed from Topic 34 entirely in 2026. No radon MPR today. | Must be noted and commented on, lender decides inspections (B4-1.4-08). |
VA column: Pamphlet 26-7, Chapter 12, effective after May 1, 2026.
Download the VA vs. Conventional Property Condition Checklist
Both programs, the same defects, screening order.
How is cosmetic damage treated under each program?
Defective paint and the 1978 dividing line
This row has cost the most offers.
VA HANDBOOK EXCERPT
“Defective paint on a dwelling built in 1978 or later is normally considered cosmetic.”
Topic 32a. If you were taught that peeling paint always has to be scraped and repainted, that is the outdated rule.
Source: VA Lender’s Handbook (Pamphlet 26-7) – Chapter 12: Minimum Property Requirement, Topic 32
VA HANDBOOK EXCERPT
“If the dwelling was built before 1978, the presence of lead-based paint must be presumed. Any defective lead-based paint is a safety hazard that must be remediated.”
Pre-1978, plan on the repair, and Topic 32d makes the VA appraiser certify it. Conventional has no paint section, so on a 1962 house VA often requires the repair and conventional may not.
Source: VA Lender’s Handbook (Pamphlet 26-7) – Chapter 12: Minimum Property Requirement, Topic 32
Handrails, cracked glass and torn screens
There is no handrail Topic in Chapter 12 and no step count in it. If someone quotes a rule about a number of steps requiring a rail, ask for the Topic number.
VA HANDBOOK EXCERPT
“The property must be free of hazards which may: adversely affect the health and safety of the occupants”
Topic 20a is the real test. Open stairs off a second-story deck with nothing to hold is a hazard. Two shallow steps off a patio usually is not. Fannie Mae lists missing handrails and cracked glass as minor conditions, which is more predictable but never automatic.
Source: VA Lender’s Handbook (Pamphlet 26-7) – Chapter 12: Minimum Property Requirement, Topic 20
Flooring and cosmetic deferred maintenance
Worn carpet or a dated bathroom gets priced into value by both programs: VA Topic 1f, Fannie Mae B4-1.3-06.
How are roof, water and structural problems treated?
Roof damage and active leaks
Topic 26a says the roof covering must prevent entrance of moisture and provide reasonable future utility, durability and economy of maintenance, and VA publishes no remaining-life figure. Fannie Mae names active roof leaks and worn shingles in B4-1.2-05, so a bad roof is a repair either way.
Water intrusion, dampness and mold concerns
VA calls excessive dampness, leakage and decay defective conditions (Topic 21c) and requires crawl space dampness to be corrected (Topic 28d). Fannie Mae names water seepage in B4-1.2-05, and B4-1.3-06 makes the lender get correction or a report showing no threat of structural damage. Neither guide has a mold section, which is why a wet basement rarely goes away by switching.
Foundation cracks and abnormal settlement
Topic 7e says minor hairline cracks from expansion or normal settlement that are common in the market area do not typically require repair. Topic 7d requires licensed repair for settlement short of a hazard, naming step cracks. Fannie Mae names foundation settlement in B4-1.2-05.
Termites, wood destroying insects and dry rot
VA is more prescriptive. Topic 33a makes the appraisal subject to a wood destroying insect inspection when infestation, fungus growth or dry rot is apparent, and all damage gets repaired. Topic 33b requires an inspection on the Notice of Value in very heavy and moderate to heavy Termite Infestation Probability Map zones. Fannie Mae has no map trigger (B4-1.3-06).
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What changed for utilities, sheds, heaters and radon in 2026?
Utilities and major systems
Frayed or exposed wiring must be repaired (Topic 14c). The property needs safe potable water, hot water, sanitary facilities and safe sewage disposal (Topic 15a), and heating must be permanently installed and hold 50 degrees Fahrenheit in areas with plumbing (Topic 23a). Fannie Mae names inadequate electrical service or plumbing in B4-1.2-05.
Detached sheds and outbuildings
VA removed the Detached Improvements subtopic from Topic 1 effective February 27, 2026, so the old advice that a leaning shed must be repaired or removed for an MPR is not current. Topic 33d lets small sheds given no value be excluded from the termite report, and Topic 20 still applies when a structure is a real hazard.
Non-vented heaters and fireplaces
VA HANDBOOK EXCERPT
“Subtopic b, Non-Vented Heater, has been removed”
The change note on Topic 23, dated February 27, 2026. The Veteran acknowledgement and the contractor certification about an oxygen depletion sensor are not current requirements. Topic 22a still requires mechanical systems to be safe to operate, so an unsafe heater is still a problem.
Source: VA Lender’s Handbook (Pamphlet 26-7) – Chapter 12: Minimum Property Requirement, Topic 23
Radon
VA HANDBOOK EXCERPT
“Radon Gas has been removed in its entirety.”
Topic 34 change note, February 27, 2026. VA does not require radon testing or mitigation as an MPR today. State law, a lender overlay or a contract term can still put radon in your deal, and B4-1.4-08 makes a conventional appraiser note a known radon condition.
Source: VA Lender’s Handbook (Pamphlet 26-7) – Chapter 12: Minimum Property Requirement, Topic 34
The House Doesn’t Meet VA MPRs. Should You Switch to Conventional?
Sometimes yes, usually no. Switching helps only when the defect is a VA MPR issue and not a Fannie Mae safety or soundness issue. Four questions.
- Is the defect a conventional problem too? Roof leaks, water seepage, foundation settlement and inadequate electrical or plumbing are named subject-to-repair items in B4-1.2-05, and a C6 must be repaired to C5. If your defect is on that list, switching buys a delay.
- Which side of 1978 is the house on? Pre-1978 defective paint must be remediated under Topic 32b and has no matching section in the Selling Guide. This is where switching genuinely changes the repair list.
- At what cost? Conventional means a down payment and, above 80 percent loan to value on a first lien, mortgage insurance under B7-1-02. VA needs no down payment with full entitlement and no monthly mortgage insurance.
- What does the timing cost? A new program means a new appraisal fee and new turn time.
- Would a VA renovation loan fit better? If the house needs real work, financing repairs beats arguing.
VA has two release valves. Topic 43a lets VA consider waiving an MPR repair when the Veteran signs the request, the lender concurs and the property is habitable from the standpoint of safety, structural soundness and sanitation, though a waiver should not create safety issues. Topic 43e lets lenders escrow for repairs done after closing, with the work finished before VA guarantees the loan. Conventional uses Form 1004D or a borrower attestation letter (B4-1.2-05).
Seller-side help exists. When a seller wants to complete a required repair but has no cash before closing, short-term equity-line options may be available, subject to eligibility, underwriting and approval. If value rather than condition is the problem, read my post on low VA appraisals and Tidewater. If the seller is pushing back, why sellers reject VA offers has my language.
Send me the scenario before you kill the deal
Year built, the defect, photos, appraisal ordered or not. I will tell you which program the condition affects.
Common questions about repair requirements
Are conventional property requirements easier than VA?
Not as a rule. Fannie Mae lets minor conditions stay as-is, including worn carpet, minor plumbing leaks, holes in screens, missing handrails and cracked glass (B4-1.3-06), and VA says nearly the same in Topic 1f. The real differences are pre-1978 paint (Topic 32b) and termite inspections in heavy zones (Topic 33b).
Does peeling paint still have to be repaired for a VA loan?
It depends on the year built. On a dwelling built in 1978 or later it is normally cosmetic (Topic 32a). On a pre-1978 dwelling it must be remediated (Topic 32b).
Does a missing handrail automatically fail a VA appraisal?
No, and there is no step count rule in Chapter 12. The appraiser evaluates whether the condition is a hazard to occupant health and safety (Topic 20a), while Topic 1f keeps minor items off the list.
Want the VA-only checklist?
The 2026 VA Property Condition Checklist walks the Chapter 12 categories in appraiser order.
Sources, read September 17, 2026: VA Pamphlet 26-7 Chapter 12 and Fannie Mae Selling Guide B4-1.3-06, B4-1.2-05, B4-1.4-08, B7-1-02 and the Property Valuation FAQs.
Carlos Scarpero, Mortgage Loan Originator, NMLS #1674385 | Edge Home Finance, LLC, NMLS #891464 | 937-572-3713 | Equal Housing Opportunity. Nothing here is a commitment to lend or a promise of approval, and lender overlays can be stricter than VA or Fannie Mae rules.
