If my house is financed by VA and I have suddenly had bad foundation damage, is there a way to get the VA to assist?

2018-02-08T21:08:57-05:00

I have a Vet in our program over $20k quotes to repair and lawyers say thousands to fight. He is young and trying hard in our program to better himself. I’ve never financed through VA but assume if the closing documents listed no damage and now some is showing up he should have some sort of assistance. Just want to point him in the right direction.

Response by SSgt Shawn Springsteen made Feb 8 at 2018 9:35 PM

2018-02-08T21:35:25-05:00

Was an inspection done on property? They usually have pictures. Is he within first 12 months of ownership? He may have a home warranty with it??

What state is property in?

Response by PO3 Jacob Jenkins made Feb 8 at 2018 9:59 PM

2018-02-08T21:59:51-05:00

can any of you assist or know anyone who can?

Response by CAPT Kevin B. made Feb 9 at 2018 12:50 AM

2018-02-09T00:50:48-05:00

VA didn't finance your loan. They just backed up the 20% you'd normally have to chip in as a down payment. So their "exposure" is small. Going to bat for you isn't in their Charter. The lender, who footed the entire bill, is the one having the most risk. In general, most sales agreements have a lot of words about "good faith", i.e. as far as I know, stuff is OK. When something happens that wallops OK, then you do the normal drill of checking out your homeowners policy. You also look to see if all the "good faith" stuff was true in that would a "reasonable person standard" in a similar situation doing a sale act the same way the players did. Same question points to the RE Agent, Title Company, and inspection outfit. Look to see if all the permits were in order on original construction. Many times a foundation bust (settlement, etc.) has to do with the water table changing or frequently a neighbor uphill does some landscape or drainage changes which pushes a lot of water underground to your property and weakening the substrate. Happens a lot in coastal California. Standby to see the various players scatter. Unfortunately, many of these issues wind up in a civil tort case. Foundations are a tricky thing people take for granted. The real "what caused it" is often clouded by people spouting theories designed to point the finger elsewhere. Sorry you have thing to deal with. Nobody deserves it.

Oh, I'll add as a Civil Engineer, this stuff is fixable, but at a cost. Foundation stabilization usually involves jacking, injection grouting and maybe bentonite injection as well. The big thing is stopping whatever is causing the settlement, lest you do a fix only to have a repeat.

Response by SGT David A. 'Cowboy' Groth made Feb 9 at 2018 5:42 AM

2018-02-09T05:42:43-05:00

My only thought on this, the inspector must have been blind.

Response by Maj Marty Hogan made Feb 9 at 2018 9:51 AM

2018-02-09T09:51:03-05:00

Ah yes- quick repairs to cover existing damage and nothing on the disclosure I am guessing. You may have some recourse if an inspection was completed. If you paid for a structural inspection (which in some areas you should) and they gave an opinion- you may have some recourse. Normally they inspect "what they can see" and the structural/mechanical inspections are above the normal walk through. When I lived down south- if you lived in a reclaimed marsh/bayou area you would do this as a matter of habit. The foundations moved all the time and shoddy contractors put up many homes quickly and moved on- 5 to 10 years later these homes were moving apart from themselves and costing several 10s of thousands of dollars to repair. I hate to say it, but without the in-depth opinions listed above, it is a buyer beware market on real estate as it is next to impossible to prove intent. Anybody else have anything here?

Response by SCPO Morris Ramsey made Feb 9 at 2018 9:58 AM

2018-02-09T09:58:27-05:00

SSgt Terry Jenkins Did you get a disclosure from the seller. In in some states you many have recourse if the seller knew and did not disclose it.

Response by SGT Dave Tracy made Feb 9 at 2018 10:41 AM

2018-02-09T10:41:09-05:00

Having some experience (personal and professional) in government backed lending and other real estate finance, I'll start by echoing what CAPT Kevin B. said; the VA only guaranteed the loan--kind of like an "insurance policy" for the lenders--but VA didn't make it, so there's no remedies to be found with VA. Now, when looking at the pictures, some of these are rather significant cracks indicating some serious settling issues. Where there signs (minor cracks or obvious localized repairs) prior to purchase? How long ago was this purchase closed? Was there anything noted in the disclosures when the house was purchased?

There was an appraisal when going through the loan process, but was a home inspection done? They're not one in the same, though appraisers will look for obvious defects which would have an effect on the value of the home. If an inspection was done was anything noted at the time?

I don't know if there's any easy remedies here. Sounds like this will have to be figured out in the courts. One way or the other, it'll cost. I wish this person the best of luck.

Response by LCDR Private RallyPoint Member made Feb 9 at 2018 10:48 AM

2018-02-09T10:48:00-05:00

When I used my VA benefit, the loan itself wasn't serviced by the VA, but by a third party...then sold within the first year to another party. During the process, a VA approved inspector did have to sign off on the home, and I was present for the inspection. My sense was that when he signed off on it...that was the end of the VA's accountability for the condition of the home. Regarding the seller's liability; as the agreement included a clause essentially stating the seller and I had agreed upon the conditions prior to sale...I wouldn't assume they have any. There may be grounds for a case if the inspection was incorrectly conducted, or the seller willfully withheld information relating to the current damage, but sadly, this may be on the buyer's account.

Response by SSgt Terry Jenkins made Feb 9 at 2018 11:04 AM

2018-02-09T11:04:37-05:00

Thanks everyone, please keep the advice coming. I am getting smarter by the minute. My plan is to work with this soldier and prepare him and then make a few calls on his behalf and see if I can throw some weight around. At a minimum the bank should be able to help him better on the loan for the repairs. With a little pushing and maybe a lot of Vets calling and perhaps a congressman and media leak I can get some attention put on this where someone will help. There is power in numbers. One of the things I have noticed in doing this program is that with all of the Veteran programs in the world Veterans still feel alone. I will make a call to the bank and let them know I will point an army towards them if they don't step up. First I have to prepare for battle, understand the enemy and then attack with a vengeance. I set out to train Veterans in IT but that is just 25% of who they are the other 75% needs to be addressed as well. How can a guy worry about job and learning new skills when he goes to bed at night worried if his house with collapse on his daughter.

Response by COL Mikel J. Burroughs made Feb 9 at 2018 12:11 PM

2018-02-09T12:11:35-05:00

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If my house is financed by VA and I have suddenly had bad foundation damage, is there a way to...

Response by CWO3 Private RallyPoint Member made Feb 9 at 2018 1:18 PM

2018-02-09T13:18:01-05:00

VA loan mostly only benefits the bank, and partly the homeowner. No protection for anything like this. They do require an inspection before signing onto the loan, so I'm surprised this wasn't discovered during the process. Check loan papers and start making phone calls.

Response by SSgt Terry Jenkins made Feb 9 at 2018 2:12 PM

2018-02-09T14:12:10-05:00

Just found out that he found pictures 04-06 time frame from Google street shows the cracks on the outside, pictures from purchase 2 years ago not there, the previous owner did landscape project dug out and put a new driveway in, claimed renovations to the house and said no damages or issues on disclosure...the previous owner was a contractor and is now a realtor. ...You know my primary job in the air force was close air support...if any of you were in the Army and were pinned down and then saw that AF guy with the floppy black beret and radios and then those A10's suddenly arrived and rained down unholy hell on the bad guy this is who I am. It's about time to run a mission again, might be time to rally the troops and make this guy famous! The information you guys are giving me is helping a lot, he is already feeling encouraged.

Response by CW3 Kevin Storm made Feb 9 at 2018 3:42 PM

2018-02-09T15:42:10-05:00

I have my doubts, as the VA didn't finance it, they backed the loan should the veteran default on it.

Response by SFC Private RallyPoint Member made Feb 9 at 2018 7:26 PM

2018-02-09T19:26:51-05:00

damn , that's pretty bad , I certainly hope that they do help you out somehow.

Response by SPC Douglas Bolton made Feb 9 at 2018 11:18 PM

2018-02-09T23:18:59-05:00

SSgt Terry Jenkins Pretty overwhelming. I just hope everything can work out for this soldier.

Response by SPC Tom DeSmet made Feb 10 at 2018 5:34 PM

2018-02-10T17:34:57-05:00

I live in Minnesota, and they push arbitration in these circumstances as part of the agreement. I had both a private and a VA inspection. They both are subject to visible damage and will not move anything to see what is behind.
As far as seller disclosure, good luck. I think we tend to get caught up in the emotional aspects of completing the purchase of the home, and especially the sale of the "old" house instead of focussing on the practical matters of inspecting it yourself and asking questions. We really should study up on the most common problems that can cost you a fortune and look really hard for ourselves in addition to the other "professional" inspections. I will tell you that the inspectors have every conceivable type of liability covered in their contract. Also, the inspectors loyalty is squarely aligned with the realtor agency because if they were to cost them a sale, the inspector won't be on the list of inspection companies presented for you to choose from and will find it difficult to find more homes to inspect.
My situation was that the home owner said there had never been any type of moisture issues with the house. It was still pretty cold at the time. The day after we moved in my wife screamed and told me there was a huge ant in the bathtub. I knew what it was as soon as I saw it- a carpenter ant. I began to look around and noticed a little saw dust below the ledger board on our deck. I continued to watch and caught one shoving sawdust out of a gap.I immediately called the realtor and then an exterminator.
The realtor was not helpful at all other than to suggest we call an exterminator. What we found out later was that their company had one realtor representing the seller and a different one representing us, and they would not get involved in any way because their boss told them to "stay out of it". They had no incentive to get involved. Then the exterminator let us know that the nest of carpenter ants was the largest he had ever seen. They had been dormant up until that time because pf the cold weather.
We spoke with a next door neighbor who told us that the previous owner had a contractor replacing the masonite siding under the deck and he had picked through the wood which was too rotten to use. We had a contractor come out and estimate repairs. They pulled a few boards and there was massive damage to the structure of the house, and the 2nd floor under the sliding door was collapsing.
We then contacted a lawyer to see what could be done. He explained about arbitration and told us to go ahead and repair the house and that we would have no problem recovering damages including lawyer fees from the previous owner. We kept in touch through this time and he communicated with the other parties lawyer as things progressed to try and get a settlement. Well about $18,000 later and we were ready for arbitration. In preparing for it we began getting signals from the exterminator, the contractors, and then even my next door neighbor that they really didn't want to get involved in the arbitration! They lawyer told us not to worry because this was such a "slam dunk" case we would be fine.
During the arbitration my "witnesses" did not exactly share all of their opinions that they had shared so freely with us. Then, we found our lawyer hadn't exactly prepared to include not remembering our name. He raised his voice at one point and the lady arbitrator told him to settle down and be respectful.
WE LOST THE CASE. $18,000 in repairs, but to add insult to injury we had almost $12,000 in attorney fees.
What I learned from this was that when you purchase a house, get a warranty, because no one else will have your back. Another thing I found ironic was that in the beginning we called our insurance company to see if they could help. Well, they let us know through the lender that they knew of the issue now and they wanted to make sure we repaired it to protect the value of the house. They VA said they couldn't help except for an "act of God".
I hope you can find help in this matter. Just don't compound the problem like I did with exorbitant attorney fees.

Response by SSG Donald H "Don" Bates made Feb 10 at 2018 6:26 PM

2018-02-10T18:26:34-05:00

I doubt very much if VA wiil help this Vet. I had VA Loan years ago and had to have my own insurance, I am sure lawyers would cost more in the long run. If I knew where he lived I could possible recomment a repair company, have done foundation repair in my past.

Response by SSG Donald H "Don" Bates made Feb 10 at 2018 6:28 PM

2018-02-10T18:28:57-05:00

Doubt very much if VA will assist. I had VA loan many years ago and had to have insurance. If I knew where he lived I could possible recommend someone as I have repaired foundations in my past construction experience.

Response by Sgt Vance Bonds made Feb 10 at 2018 7:15 PM

2018-02-10T19:15:57-05:00

I'm VA But was told mine only guarantees the loan to the financial institution should I default.
I bought insurance on the home to cover thijngs like this. Hope he did as well. It would be rolled into hos loan payments

Response by PO3 Phyllis Maynard made Feb 10 at 2018 7:18 PM

2018-02-10T19:18:48-05:00

SSgt Terry Jenkins I have read about seven responses and I would have tried to put all of that info in my response. But, let me say this my carport has that same foundation problem and there is evidence of foundation shift in my full basement that is used as a second house. First of all my realtor advised I have the house inspected. Second, although the Realtors did not want buyer and seller meeting up we did. The seller wanted to point out things to me and explain why the repairs were made. The carport was regrouted and the basement was painted with waterproofing (Shur Wall) and a correct protective trench and berm we're constructed to turn the water coming down the neighborhood knoll directly rmto my house. Also I have cracks in the ceiling and an attic. I see you have wall cracks. Once corrective action takes place on the foundation shift it affects the inside because the inside has no reason to move. The for the inside the same contractor can make a recommendation. As for the VA getting involved. No, they don't they are a lending institution. WAIT let me interject this. As a 100% service connected veteran, my house was 100 percent financed by the military financial institutional I used. Under that program, they require that the buyer pay for an appraisal from a contractor or agency that they partner with. If that appraiser feels the purchase is a liability for the lender it will be reflected in the appraisal. But, in the old, old school days, like the 1970s and 1980s lending institutions did take a proactive part in these matters. But because so many people have campaigned to get insurance companies and lending institutions out of the equation so that they can get a good deal or not have to deal with strict requirements for the institutions, the new schoolers are on their own for covering all the bases. If you had your house inspected by a licensed inspector and he did not note the problem or the licensed appraiser did not note the problem, you may be able to get assistance through their professional insurance. Go back and check the pictures from the realtor to see if any of the shots showed those affected areas. If the professionals involved in your purchase did not take short cuts, you will have to get a building contractor to repair the areas. WHEN YOU DEAL WITH ANY CONTRACTOR ensure they have a general contractors license, worker's compensation, property liability insurance, and some people like for contractors to be bonded to protect them in cases of theft. Ask them to produce the documents. But as one poster said, your problem is fixable. Just do your due diligence when hiring people to do work on your property because that can become another catastrophe. My house was built in 1957. Back then they used quality wood and quality masonary. They did not erect them in 6 months, sometimes it was 6 years. But seriously houses back then were completed in about 2 years. COL Mikel J. Burroughs = COL Proactive :0)

Response by SGT Walter Lester made Feb 10 at 2018 8:30 PM

2018-02-10T20:30:07-05:00

Buying a house through a VA loan or private sale,unless it is sold with a warranty against damage after the sale. The VA will not cover the repairs. It should have been inspected by an inspector of the VA's chosen and the buyer should have done his own inspection of the home before the sale.
Your VA loan is not financed by the VA unless they cannot find a finance company or bank to take the loan. If they cannot find a company to take the loan, they will continue until they do.

Response by CPT Private RallyPoint Member made Feb 10 at 2018 11:13 PM

2018-02-10T23:13:58-05:00

The house could have been appraised by either a fee appraiser or a VA employee appraiser. Assuming that this is still the way it done, it could have a bearing upon the ultimate disposition. My mother was a fee appraiser and was always very concerned about missing something. Her concerns were not just motivated by her concerns for the veteran, but also out of concern for losing her position. Please realize she was most active in the 70s & 80s. As a general rule people took much greater pride in their work back then than now. If the veteran has insured by USAA they have a better chance than otherwise. Is the area where the house is built known for shrink swell soil? Is the veteran's Congressman or either of the Senators known to be be extremely pro-military, very anti-VA, or hopefully both?
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Response by SSgt James Tadlock made Feb 12 at 2018 2:57 PM

2018-02-12T14:57:24-05:00

What about checking with "New Day USA" [login to see] . Chairman is Admiral Tom Lynch (USN Ret). They or another company similar to them might be willing to do a refinance which would free up some money to get the repair done. Might be able to even get a lower percent rate or at least close to what you have. Check all and choose the best for you. The house appears to be not old.

Response by COL Charles Williams made Feb 13 at 2018 12:05 AM

2018-02-13T00:05:42-05:00

Insurance?

Response by SSG Guy Gould made Feb 16 at 2018 4:59 PM

2018-02-16T16:59:07-05:00

First things first, you're aiming at the wrong target. Neither the lender nor the VA have any responsibility in the state of repair of your house. That being said, you would have to answer the question, "Did the seller of the house know about this BEFORE the closing of the sale?" And, can you prove it. If you can prove that the seller knew or should have known and did not disclose it in accordance with the real estate laws in your state, the sale could be nullified if the sale is no older than 3 days. But, that's it unless the nullification inspires the seller to be generous and make the repairs in lieu of having to pay all of that money back.

Response by Col Robert Wallace made Feb 18 at 2018 7:50 PM

2018-02-18T19:50:01-05:00

When considering purchasing a home, and the financing is through the VA or other lenders, one of the first things is to have the building inspected by a certified inspector/company. If the inspection is passed, then continue with the closing. A VA Resource Officer can re-check all documents to ascertain if the possibility of damage occurring. It cannot be assumed if no damage or possibility of damage. It indeed such possibility existed by document proof, the VA can bring pressure on the Building Inspector/Inspecting Company as to why the inspection document was signed off as "passed", and to assist in the financial repair. The VA can also assist in providing a second certified inspection to solve the issue. Sadly, there are building inspectors/company that work with real estate companies to expedite the sale/closing of the home. My best wishes go to the vet having this problem.

Response by CW5 Randall Hirsch made Feb 25 at 2018 7:09 PM

2018-02-25T19:09:43-05:00

You should ALWAYS get a home inspection before making an offer on a house. The 2 or 300 dollars for this service will save you money in the long run!

Response by Lt Col Doug Webster made Feb 27 at 2018 9:58 PM

2018-02-27T21:58:25-05:00

Did he get a home inspection prior to the sale? My guess is that if the problem was known prior to sale and not disclosed by the seller, he has a case (regardless of who holds the loan). If this suddenly appeared after the sale and the former owner had no reason to suspect, the owner and the lender are not insuring the property. This is a matter for the home owner insurance in that case.

Response by SPC Steve Knipe made Mar 5 at 2018 2:46 AM

2018-03-05T02:46:04-05:00

Regardless of what VA or realtor will do you should check with your state about insurance fund realtors have to pay into. It is a fail safe plan that protects the buyer against just this scenario. The seller and realtor have to divulge any problems, even if someone died in the house before. The state pays off if the seller or realtor can’t, or won’t, pay.

Response by PFC Allen Nichols made Mar 26 at 2018 7:57 AM

2018-03-26T07:57:18-04:00

You’re going to be barking up the wrong tree with VA and loan officers. Look over your buyers contract and find the disclosures that were made about the property. Next, talk to your neighbors about any repairs “Joe That Lived Their” made (drywall?) and get a name of the company. Call the company and ask for records, invite them to your home to see if that’s the location where the company made repairs. Once you can demonstrate repairs were not disclosed, then you will file a claim against the Realtor’s errors of omission policy. That’s where the money to cover repairs will come from...or maybe even void the sale.

Response by A1C Bill Jodeit made Apr 8 at 2018 3:46 PM

2018-04-08T15:46:32-04:00

As I understand it the VA does not finance homes. They guarantee the loans. In any case the lender has no responsibility in this situation.
Was there a home inspection accomplished prior to the purchase? There might be liabilities for the inspector if he failed to note a significant defect.
Was there a disclosure statement?
What are the state laws?
Short of an earth quake or sink hole this sort of damage does not appear overnight. It takes time.
How long since the house was closed?
As you can see there are a lot of questions and I would start with a home inspector to fully understand the problem. Then use the attorney. Without an attorney the homeowner will not be taken seriously, if there is a case at all.
I only speak for experience as one who has owned and been around homes and the industry. I carry no legal or professional credentials just experience. Good luck.

Response by SGT Aric Lier made Apr 8 at 2018 4:00 PM

2018-04-08T16:00:49-04:00

depending on the state ( check Laws) you can sue , florida for example lets victims collect up to 50K out of state funds, the broker will forfeit his license until paid back.. check the local laws and governing body

Response by Sgt Kelli Mays made Apr 9 at 2018 11:03 PM

2018-04-09T23:03:09-04:00

SSgt Terry Jenkins What needs to happen here is to determine whether the seller told the truth/whole truth...(look at your real estate contract and check out the "disclosure."..... and then put a claim into USAA...if USAA determines this is a pre existing issue, then you can actually put a claim in through this guys insurance company since it happened during/while the seller owned the property....hopefully, the seller had insurance on the property...if he had a note on it, he would have had insurance on it.

Response by MSgt Currie C. made Apr 25 at 2018 12:37 AM

2018-04-25T00:37:03-04:00

It depends where you live. I've had my home since 1980. Two years ago the foundation settled about 1". It cost me $14,500.00, to fix the foundation. Sometimes "stuff just happens". He should check with his neighbors just see if they are having problems too.

Response by SGT Ed Alemany made May 7 at 2018 12:46 PM

2018-05-07T12:46:00-04:00

No, unfortunately, the VA Loan Guaranty covers the loan in the event of a foreclosure, waives the 20% downpayment and need for mortgage insurance(FHA) and pretty much that's about it.

Response by SGT Dave Thompson made May 7 at 2018 2:54 PM

2018-05-07T14:54:55-04:00

At 69 years old, I’m living in my second home financed through the VA loan guarantee program. As per VA home loan regulations, both my previous home and now this one were required to undergo stringent inspections.

You don’t mention how long ago the Veteran in the House with structural damage purchased his home, or if there have been any acts of Mother Nature - like earthquakes - since he made the home purchase. Assuming there have been none, I would wonder if the Veteran would have legal recourse against the VA housing inspector?

Response by Rhonda Dring made Mar 14 at 2019 6:05 PM

2019-03-14T18:05:54-04:00

We are in the same boat.
Just after 24 hours of getting our keys, we had flooding. Our house is falling apart and only been in the house for 4 months.

Response by SPC Cristina Moen made Dec 30 at 2020 1:06 AM

2020-12-30T01:06:43-05:00

Do you have more information, I feel like this happed to me as well.

Response by PVT Robert Chandler made Jun 19 at 2021 12:29 PM

2021-06-19T12:29:40-04:00

Theres only two big companys you should first get a price from. Cable Lock Foundation Repair and that can be your base. But ask around because i am only a MOP

Response by SP5 Andrew Jackson made Jun 25 at 2021 10:49 PM

2021-06-25T22:49:26-04:00

well they did inspect it so they must have missed something. OR someone got a few bucks

Response by PO2 Mike Vignapiano made Jun 27 at 2021 2:29 PM

2021-06-27T14:29:07-04:00

He might have a case depending on how recent the Home Inspection was performed. Was the foundation even part of the inspection? If not, the inspector could be liable unless they specifically stated it was not part of the inspection and the buyer agreed and understood that it was not. Also, it should be covered by his Home Owner's Insurance. That of course depends on the type he purchased. A VA mortgage is not what it used to be. Although it allows a slightly higher Debt to Income Ratio, no down payment, allows no PMI/MIP and Guarantees the loan to the lender in case the service member defaults on it. In the past it also allowed for a lower rate and if you were buying a house within your first few years after discharge, your credit score did not matter.