16-07: VA Circular 26-16-8 Water Contamination in Flint, Michigan


As previously announced in PennyMac Announcement 16-04, all loan programs requiring an appraisal require documentation to evidence the subject property is served by water that meets the requirements of the EPA. 

In accordance with VA Circular 26-16-8, PennyMac is aligning with VA’s requirements to document all loans secured by properties in Flint, Michigan meet the Minimum Property Requirements (MPR) for safe and potable water. 

VA Full Doc

If an appraisal is provided, the lender must follow VA requirements to document the water meets the MPRs for safe and potable water, as summarized below:

    • Lead contaminated water must be mitigated by a central filtering system that meets local health authority requirements
    • Appraisers must comment on the market impact of the water contamination, and indicate if the subject is connected to the Flint water district
    • Lenders must document the NOV, indicating the water is acceptable
    • Lenders must provide an acknowledgement stating the Veteran is aware the municipal system is lead contaminated and the home contains a central water filter system.

Please refer to the Circular for complete details.


If an appraisal is not required, a water test must evidence the property meets the MPRs for safe and potable water. 

Please contact your Sales Representative with any questions.