Deciphering the VA Lender’s Handbook Chapter 12 Part 7
The Minimum Property Requirements don’t have too much to say about gas and petroleum pipelines or electric lines. They do, however, have a lot to say about water. So we’ll cover the fuel and electric line requirements in this article first, then get started on the water requirements. The rest of the water requirements will be covered in subsequent articles. If you want to know what the VA’s MPRs are and you also want to know what they mean to you, you’re in the right place, and we encourage you to read all of the articles on the MPRs that you are interested in learning more about. Learning the MPRs is invaluable for a VA borrower in all stages of the purchasing process. Knowing the MPRs can help you select a house that will fulfill them, help you know what concerns will need to be resolved with the seller long before the appraiser ever gets there and help you read the appraisal and challenge it if need be.
To understand the fuel pipeline MPRs, you have to know what an ‘easement’ is. An easement is a legal right or agreement to use or cross someone else’s property for a specific purpose. For example, if you live on the corner of a busy street and a cul-de-sac, you might have a big green metal box on your property. There is likely an easement in place for workers from the power company to access that green box without your permission. The VA doesn’t have an issue with an easement in place on a property for high-pressure gas or liquid petroleum pipeline – as long as no part of the residential structure is located within the easement. Any detached improvements (such as a shed), that is partially or completely within the easement will not be able to receive a value as part of the appraisal. Fuel lines can cause problems even for properties that are not within an easement if a residential structure is within 220 yards of the centerline of the pipeline. If this is the case, the appraiser will need one of the following:
- High-Pressure Gas Pipelines – A statement from an authorized official of the pipeline company certifying compliance with 49 CFR 192.607, 192.609, 192.611 and 192.613.
- Liquid Petroleum Pipelines – A statement from an authorized official of the pipeline company certifying compliance with 49 CFR 195 and amendments thereto.
The requirements for high voltage electric transmission lines are very similar to the requirements for gas and fuel lines – no part of the residential structure may be located within the easement, and any detached improvements that are partially or fully within the easement will not be considered as part of the Notice of Value. There are two main reasons for these requirements for fuel lines and electrical lines. The first is a potential safety concern, and the second is a privacy concern; if part of the residential structure is within the easement, then utility workers are legally allowed to enter the home without permission and without notice for maintenance and repairs to the line.
Let’s get started with water. The MPRs about water falls into two different categories: Individual requirements and community requirements. We’ll be covering individual requirements first. The property’s water system and sewage disposal system must be connected to a public or community system whenever feasible. The water on the property must be of a quality sufficient to meet the requirements for the health authority that has jurisdiction over the property. If the local authority does not have any requirements, then the maximum contaminant levels established by the EPA are considered the requirements. The water will have to be tested as part of the appraisal, so be ready for that. Either the local health authority is required to come test it, or, if they cannot do so in a timely manner, a commercial testing laboratory or licensed sanitary engineer can perform the test as well.
In the next article, we’ll get into water treatment systems. The importance of having clean and safe water on the property is difficult to overstate; clean water is one of the things we absolutely must have to survive. It makes sense that the VA wants to make sure that the water on the property is safe for use.