What is the VA amendatory clause?
A VA-required addendum to the purchase contract that lets the buyer walk away from a VA purchase without losing earnest money if the appraised value comes in below the contract price. The seller must sign it for VA to close.
What this actually means.
The amendatory clause is a one-page addendum that becomes part of the contract. If the VA Notice of Value comes in low, the buyer can choose to: 1) cancel the contract and recover earnest money; 2) renegotiate price; or 3) bring cash to bridge the gap. The seller's signature on the clause is mandatory. Without it, VA does not insure the loan. Subject to VA guidelines.
Where this can move.
Property condition against MPRs, repair requirements, Tidewater process, and Reconsideration of Value can change the appraised value and timeline.
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Educational only. VA guidelines, lender overlays, rates, fees, and underwriting requirements can change. Final eligibility depends on full underwriting review. Mortgage Expert, Inc. is not affiliated with the VA, HUD, or any government agency.