VA Loan Construction Inspections – Third Inspection Stage


Deciphering the VA Lender’s Handbook Chapter 14 Part 5


As you’ve hopefully read from the two articles previous to this one, the VA construction inspections are broken up into three stages. Technically, though, there are actually four stages, but the third and fourth usually occur at the same time. In the previous articles we covered stage 1 and then stage 2, and in this one we’ll go over the third stage. This is obviously important information for builders to know, but it’s also important for the borrower to know if they are trying to get a VA construction loan – especially if they are planning on doing some or all of the work themselves. Also, it’s helpful for any VA borrower to know that if the home was built with VA inspections, there was an in-depth examination of the property done so if you find something wrong with your home after you’ve bought it, you can usually track down the inspection reports and see why it didn’t come up. This also applies to those who are making major improvements to their home using a cash-out refinance.

Construction Inspection Step 3The third (and fourth) inspection takes place after construction has been completed on the property, and the inspector checks for acceptable completion of all of the onsite and offsite improvements or construction. The third inspection really is a long and comprehensive process. The items that the inspector must check are grouped into two categories: exterior and interior, and cover the entire property from top to bottom, inside and out. The Handbook includes a full list of all the things that the inspector is to check for, which we have included below. The exterior list of things covers the pouring of the cement for the sidewalk and driveway, any retaining walls, utility connections, painting, and anything else that you might see, hear, or smell while living there. Here is the list for the exterior inspection:

  • compaction of fill material
  • protection against the elements and penetration of moisture
  • utilities
  • finish grading
  • masonry pointing
  • storm sewer system
  • drainage
  • caulking at openings
  • drainage channels
  • utility connections
  • paint coverage
  • grading
  • walks
  • flashing
  • curbs
  • drives
  • design of dwelling structure
  • gutters
  • accessory buildings
  • materials and details of their installation and finish
  • paving
  • retaining walls
  • pavement edging
  • planting
  • subgrade
  • safe terraces
  • base and wearing surface and erosion control
  • safe porches
  • safe areaways


Remember, the above list only covers the exterior things that need to be inspected. The third inspection also includes a thorough examination of the interior of the property. The superstructure and foundation of the home undergo their examinations at the first and second stage inspections, so the interior portion of the third inspection covers all of the finish work and work done in, around, and through the superstructure. Here is the list of the things that the interior inspection covers, as provided by the Handbook:

  • design
  • cabinets and millwork
  • quality and operation of hardware
  • materials, equipment, and details of their installation
  • details and operation of systems, equipment, and fixtures related to plumbing
  • quality of tilework
  • interior surfaces and their finish treatment
  • “” “” related to heating
  • quality of glass
  • “” “” related to ventilating
  • quality of linoleum
  • “” “” related to electric
  • venting of attics and underfloor spaces


In addition to all of the things in both the interior and exterior inspections, the inspector will also check that the individual water supply and sewage disposal system is in full compliance with the health authority having jurisdiction.

Construction Completion

Now, as mentioned above, the fourth inspection usually takes place at the same time as the third inspection, so what does the fourth inspection cover? It’s quite simple in comparison to the third; the inspector needs two pictures, a short description of the suitability of the property, a report of any shortcomings on the property, and state that any issues have been reported. The two pictures are to record the appearance of the dwelling and indicate the grading and drainage of the site. The short description should describe the condition, suitability, and readiness for use of all equipment, fixtures, and observable construction of the property. Shortcomings that might be reported include scratches in paint, poorly fitted doors, stuck windows, cracks in walls, etc.


If you’re interested in more information about the VA inspections, call or contact us here at Low VA Rates.


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