What Every Buyer or Seller Needs to Know
If you are reading this, your VA appraisal has likely entered the Tidewater process. While that can sound stressful at first, Tidewater does not automatically mean your appraisal is coming in low or that your deal is falling apart.
The term “Tidewater” actually comes from the Tidewater region of Virginia, including areas like Norfolk, Virginia Beach, and Hampton Roads, where the process originally began as a pilot program before expanding nationwide throughout the VA loan system.
Today, Tidewater is simply a safeguard built into the VA appraisal process. It gives the appraiser an opportunity to gather additional market support before issuing a final value.
What Does Tidewater Mean?
Tidewater occurs when a VA appraiser believes there may not currently be enough comparable sales or market evidence to fully support the agreed contract price.
Before finalizing the appraisal, the VA requires the appraiser to notify the lender and allow a short window, usually about two business days, for additional information to be submitted. This may include stronger comparable sales, recent market activity, upgrades to the property, or other relevant data that supports the value.
Most importantly, Tidewater is not a loan denial, and it does not automatically mean the appraisal will come in low. Think of it as an early warning system that creates an opportunity to strengthen the file before the appraisal becomes final.
How the Tidewater Process Works
- Buyer and seller agree on a price: The home goes under contract at an agreed purchase price.
- The VA appraisal is ordered: The lender orders the appraisal through the VA system.
- The appraiser reviews the property and comparable sales: The appraiser evaluates the home and studies recent sales in the area.
- Tidewater is issued if value support is uncertain: This happens before the appraisal is finalized.
- The lender and agents are notified: The parties involved are informed that additional support can be submitted.
- Additional information is submitted: This may include comparable sales, upgrades, market trends, low inventory conditions, or other relevant market evidence.
- The appraiser finalizes the appraisal: After reviewing the information provided, the appraiser issues the final value.
Who Handles the Response?
In most cases, the listing agent takes the lead during Tidewater because they originally priced the home and should already have supporting market data prepared.
The buyer’s agent still stays involved to help protect the buyer, communicate updates, and provide additional market insight if needed. The lender coordinates communication with the appraiser throughout the process.
What Happens if the Appraisal Comes in Low?
Even after Tidewater, the appraised value could still come in below the contract price. If that happens, there are still several possible paths forward.
The buyer and seller may renegotiate the price, split the difference, or the buyer may choose to bring additional cash to closing. If strong evidence supports a higher value, the lender may also request a formal Reconsideration of Value after the appraisal is issued.
VA buyers are also protected by the VA Escape Clause, which generally allows them to walk away from the transaction if the appraised value comes in below the agreed purchase price and they no longer wish to proceed.
Final Thoughts
Receiving a Tidewater notice can feel intimidating, especially for first-time buyers. However, Tidewater is not the end of the transaction. It is simply part of the VA appraisal process designed to ensure the appraiser has the best possible market information before issuing a final value.
With strong communication and solid market data, many transactions continue moving forward successfully after Tidewater.