VA requires the amendatory clause in a VA purchase contract signed before you receive the Notice of Value. It says you do not forfeit your earnest money if VA values the home below your price. You can ask the seller for a lower price, pay the gap with your own money, or exit without forfeiting your earnest money. VA calls it the VA Escape Clause. VA reports that nationwide, 91.38% of its appraisals met or exceeded the sales price in fiscal year 2022. That says nothing about any one Las Vegas home, so the clause is a backstop.
Earnest money is the deposit you give the seller when the seller accepts your offer. It is real money, and you want it back if the deal falls apart. The amendatory clause is what keeps that deposit safe if the VA appraisal comes in low.
The clause comes from a federal rule, 38 CFR 36.4303(k). VA's own Escape Clause page, last updated January 14, 2026, explains how lenders must use it. This guide walks through both, plus the Nevada rules on who holds your deposit. Each rule was checked against the sources listed at the bottom on October 4, 2026.
Key takeaways
- The VA amendatory clause protects your earnest money. Under 38 CFR 36.4303(k), you do not forfeit it if the price is above the value VA sets.
- It is required when you sign before the appraisal result. VA says buyer and seller must sign it if the contract is signed before you get the Notice of Value, the letter that states VA's value for the home.
- A low value gives you three paths. Ask for a lower price, pay the gap with your own funds, or exit without forfeiting your deposit. You can also ask VA to look at the value again first.
- It only covers a low VA value. VA says the clause may not be used to cancel a contract for any other reason.
- VA's 2023 report showed most appraisals meeting the price. VA told Congress that nationwide, 91.38% of VA appraisals in fiscal year 2022 met or exceeded the sales price.
- What the clause does: protects your earnest money if VA's value is below your price.
- When it is required: when the contract is signed before you get the Notice of Value.
- Your choices after a low value: lower price, pay the gap, or exit without forfeiting your deposit.
- What it does not cover: any reason other than a low VA value.
- Clark County VA appraisal fee: $750 for a house, 6 business days, under VA's May 1, 2026 table.
What is the VA amendatory clause?
The VA amendatory clause is VA home loan contract language that protects the buyer's earnest money. It says the buyer will not forfeit earnest money, and does not have to buy, if the price is higher than the value VA sets.
VA's value for the home is called the reasonable value. It comes from a VA appraisal. A VA purchase loan generally cannot be larger than that value. The rule is in federal law, 38 U.S.C. 3710(b)(5), which has narrow exceptions.
So a low value creates a gap between the price you agreed to and what VA will back. The clause decides what happens to you in that gap. Here is the wording VA's rule requires, word for word.
It is expressly agreed that, notwithstanding any other provisions of this contract, the purchaser shall not incur any penalty by forfeiture of earnest money or otherwise be obligated to complete the purchase of the property described herein, if the contract purchase price or cost exceeds the reasonable value of the property established by the Department of Veterans Affairs. The purchaser shall, however, have the privilege and option of proceeding with the consummation of this contract without regard to the amount of the reasonable value established by the Department of Veterans Affairs.
38 CFR 36.4303(k), Electronic Code of Federal Regulations, current text read October 4, 2026. Read the rule.
In plain words, the first sentence protects you. The second sentence keeps the door open. If you still want the home, you can go ahead at the higher price.
You will hear several names for the same thing. VA calls it the VA Escape Clause. Agents may call it the amendatory clause, the VA option clause, or the VA amendment to contract. They all point to this same language.
When does a VA contract need the escape clause?
VA says a VA home loan purchase contract needs the escape clause when you sign it before you receive the Notice of Value. If you sign your offer before the appraisal is done, this rule applies to you.
The Notice of Value, or NOV, is the letter that states VA's value for the home. VA's Escape Clause page, updated January 14, 2026, sets the rule for lenders.
The VA Escape Clause must be signed by the buyer and seller on all VA home purchase loans, if the sales contract is signed before the Veteran receives the Notice of Value. This includes contracts for new construction.
U.S. Department of Veterans Affairs, VA Escape Clause, VA Home Loans, page last updated January 14, 2026, read October 4, 2026. Read VA's page.
Three more rules from the same VA page matter here.
- If the clause is missing, the contract must be amended to add it before closing.
- The lender is responsible for making sure the clause is in the sales contract before closing.
- If the clause is not in the contract, VA will not guarantee the loan.
The clause can be written into the contract or added as an addendum, an add-on page signed with the main contract. Ask your agent to show you where the VA clause sits in your Las Vegas contract before you sign. The guide to VA home loans in Las Vegas covers the steps from offer to closing.
What can you do if the VA appraisal comes in low?
If the VA appraisal comes in below your price, the VA Escape Clause gives you three choices. Ask the seller for a lower price, pay the gap with your own money, or exit without forfeiting your earnest money.
VA's page lists them in these words. The clause lets the Veteran:
- "Negotiate with the seller to lower the purchase price"
- "Proceed with the transaction by covering the price difference by making a down payment with the Veteran's funds"
- "Exit the transaction without forfeiting any earnest money deposit"
VA.gov's home buying page adds a step you can take first. You can ask for a reconsideration of value. That means asking VA to review the value again, using recent sales that support a higher value. More on that below.
VA's April 2023 report to Congress says that nationwide, 91.38% of VA appraisals met or exceeded the sales price in fiscal year 2022. For fiscal year 2023 through March 1, 2023, the share was 94.38%. Those are the report's periods, not a forecast. A low value can still happen on any home, so know how the clause works.
| Choice | What you do | Your earnest money | Cash you bring for the gap |
|---|---|---|---|
| Ask VA to look again | Send recent sales that support a higher value | Depends on your contract deadlines | Depends on the new value |
| Lower the price | Ask the seller to drop the price to VA's value | Stays in the deal | None for the gap if the price meets the value |
| Split the gap | Seller lowers the price part way | Stays in the deal | What is left of the gap, from your own funds |
| Pay the gap | Keep the price and cover the difference | Stays in the deal | The full gap, from your own funds |
| Walk away | Exit using the VA Escape Clause | Not forfeited; returned under your contract terms, if applicable | None |
Valley West take.Paying the gap means bringing cash on top of your closing costs. Before you agree to it, add the gap to your full cash-to-close number and consider whether you would still have savings left after closing.
Does the amendatory clause protect all of your deposit?
On a VA home loan, the amendatory clause protects your earnest money deposit. It does not cover deposits you pay a builder for upgrades on a new home, because VA says those are not earnest money.
When you walk away under the clause, VA says whoever holds your deposit in escrow (a neutral account that holds money until closing) has to follow your contract.
If a contract is terminated because the reasonable value established by VA is lower than the contract price and the buyer invokes the VA Escape Clause, the title company or other entities holding the escrow funds must follow the contract terms and return the deposit, if applicable.
U.S. Department of Veterans Affairs, VA Escape Clause, VA Home Loans, page last updated January 14, 2026, read October 4, 2026. Read VA's page.
New construction needs extra care. VA's page answers it directly: deposits to the builder for upgrades on new construction "are not considered earnest money and are not covered by the VA Escape Clause." Say you pay up front for a better kitchen or flooring package. Read the builder's contract to see what happens to that money. The guide to VA loans on new construction in Summerlin and Cadence covers builder contracts in more detail.
Who holds your deposit in Nevada. Your contract names who holds it. Under NRS 645.310(4), a Nevada real estate broker who receives earnest money must promptly put it in a trust account at a bank or credit union in Nevada. The exception is when everyone with an interest in the money agrees otherwise in writing. One example is having an escrow company hold it. A separate rule is NRS 645.630(1)(k). It lists a broker's failure to deposit earnest money before the end of the next banking day after acceptance as grounds for discipline. The purchase agreement can provide otherwise.
To see where your deposit sits, and how it is credited at closing, read the guide to VA earnest money and cash to close in Nevada.
Can you use the VA escape clause to back out for other reasons?
No. A VA appraisal below the contract price is the only reason the VA escape clause can be used. VA says it may not be used to cancel a purchase contract for any other reason.
The VA Escape Clause may not be used to cancel a loan purchase contract for any reason other than in response to the reasonable value established by VA being lower than the contract price.
U.S. Department of Veterans Affairs, VA Escape Clause, VA Home Loans, page last updated January 14, 2026, read October 4, 2026. Read VA's page.
So the clause is not a general way out. If the home inspection turns up a problem, or your loan approval stalls, other parts of your contract decide what happens to your deposit. Those are the contingencies, meaning the conditions that must be met for the sale to go through. Ask your agent which ones your contract has and their deadlines.
The clause also does not cover a home that fails VA's property rules. That is a separate issue. VA's minimum property requirements are basic safety and condition rules for the home. The guide to VA appraisal requirements in Nevada explains those rules.
How can you challenge a low VA value before you walk away?
You can challenge a low VA appraisal value in two ways. Tidewater (the appraiser's 48-hour data window) lets your side send sales data before the appraisal is final. A reconsideration of value lets you ask VA to review the value after the Notice of Value is issued.
Tidewater comes first. VA's April 2023 report to Congress describes it this way. If the appraiser expects the value to come in below the sales price, the appraiser must tell the requester. Then the appraiser must allow 48 hours for the agent, lender or Veteran to send evidence-based data that supports the price.
A reconsideration of value, or ROV, comes after. The same report says the Veteran may ask for an ROV once the appraisal is done and the NOV is issued. VA reviews what you send plus its own market data. If VA finds a higher value is right, VA will amend the NOV.
The best support is recent nearby sales of similar homes that the appraiser did not use. Your agent can pull these from local sales records.
Time is the trade-off. VA's 2026 fee table gives a Clark County appraiser 6 business days to finish. VA's 2023 report says VA appraisals averaged 7.2 business days nationwide in fiscal year 2023 through March 1, 2023. VA's report notes that Tidewater may lengthen processing, so watch your contract deadlines.
| Area | Single family | Condo | Manufactured home | 2 to 4 units | Business days |
|---|---|---|---|---|---|
| Clark County | $750 | $750 | $800 | $1,000 | 6 |
| Nevada (base row) | $750 | $750 | $800 | $1,000 | 7 |
Under contract on a Las Vegas home?
See how a low VA value would change your numbers. Rules checked October 4, 2026. A local lender can walk through your contract price, your cash to close and your options before the appraisal comes back. No obligation, and all loans are subject to approval.
Check my VA loan optionsWhat does a low VA appraisal look like on a Las Vegas home?
A low VA appraisal on a Las Vegas home creates a cash gap equal to the price minus VA's value. Here is a worked example with each choice priced out.
Say a veteran signs a contract on a Las Vegas home for $420,000 and gives the seller a $5,000 earnest money deposit. The contract was signed before the appraisal, so it includes the VA Escape Clause. The VA appraisal comes back at $405,000.
- The gap. $420,000 minus $405,000 = $15,000. The VA loan is based on the $405,000 value, not the $420,000 price.
- Choice one: ask VA to look again. Say an ROV raises the value to $412,000. The gap shrinks to $420,000 minus $412,000 = $8,000.
- Choice two: lower the price. The seller agrees to $405,000. The gap is $0.
- Choice three: split it. The seller drops $9,000, to $411,000. The gap left is $411,000 minus $405,000 = $6,000, paid from the veteran's own funds.
- Choice four: pay the gap. The veteran keeps the $420,000 price and covers the full $15,000 gap from their own funds.
- Choice five: walk away. The veteran exits under the clause. The $5,000 deposit is not forfeited, and it is returned under the contract terms, if applicable.
The appraisal fee is a cost either way. In Clark County, VA's 2026 table sets it at $750 for a single family home. If you walk away and buy a different home, expect a new appraisal on that home.
These figures are illustrative only and are not a quote, offer, or commitment to lend. They are sample contract prices, appraisal values and deposits, not a down payment amount or a loan offer. Your own numbers depend on your contract, your VA value and your lender.
Check your appraisal gap
The VA appraisal gap checker below shows your cash gap if VA's value comes in low. It also shows whether VA says your contract needs the escape clause. Enter your own numbers.
VA appraisal gap checker
This runs in your browser and saves nothing. It follows 38 CFR 36.4303(k) and VA's Escape Clause page, updated January 14, 2026. It is a guide, not an approval, and not a commitment to lend.
Based on your answers: VA's value is $15,000 below the price. The VA Escape Clause lets you ask for a lower price, cover the remaining $6,000 gap with your own funds, or exit without forfeiting your $5,000 deposit (return follows your contract terms). This is not an approval. Check your actual contract.
Method: the gap is the contract price minus VA's value, never below zero. The cash gap is the gap minus the seller's price cut, never below zero. VA says the clause is needed when the contract is signed before the Notice of Value (VA Escape Clause page); the clause wording is in 38 CFR 36.4303(k). Builder upgrade deposits are not earnest money and are not covered (VA Escape Clause page). Figures are illustrative only and are not a quote, offer, or commitment to lend.
The decision rule
What to do after a low VA appraisal depends on the size of the gap and your cash. Use the first line that fits you.
- The clause is not in your contract. Stop and fix that first. VA says the contract must be amended to add it before closing, or VA will not guarantee the loan.
- You have recent sales that support your price. Ask for a reconsideration of value before you decide anything else.
- The seller will lower the price to VA's value. Take the lower price. The gap is gone.
- The seller will meet you part way. Consider paying what is left only if you would still have savings after closing costs.
- The gap would drain your savings. You may want to consider exiting under the clause, without forfeiting your earnest money. Then look at homes priced closer to recent sales.
If you are buying a condo, the value is only one hurdle. The building also has to meet VA's condo rules, so ask your lender to check the project before you make an offer. And for the full list of costs you may pay at closing, see VA closing costs in Nevada.
If you go ahead with the purchase, your lender will also ask for proof of homeowners insurance before closing. Valley West Insurance explains what a Las Vegas homeowners policy needs to show by closing day.
The bottom line
On a VA home loan, the amendatory clause is a safety net for your deposit. If VA values a Las Vegas home below your price, you can ask for a lower price, pay the gap yourself, or exit without forfeiting your earnest money, with its return following your contract terms. VA says it must be in any VA contract signed before the Notice of Value, and VA will not guarantee the loan without it.
It has limits. It only covers a low VA value, and it does not protect builder upgrade deposits. Read your contract with your agent before you sign, and keep enough cash in reserve to handle a gap if you want the home badly.
Want the bigger picture first? Valley West's main site explains how a VA purchase moves from offer to closing in Las Vegas.
Article history
- October 4, 2026, first published. Each rule and quotation was checked that day against the sources listed below, including 38 CFR 36.4303(k) and VA's Escape Clause page, updated January 14, 2026.
| Rule | Source | Date in source |
|---|---|---|
| Amendatory clause wording | 38 CFR 36.4303(k) | Current eCFR text, read 10/04/26 |
| Who signs, missing clause, limits | VA Escape Clause page | Updated 01/14/26 |
| Loan not above VA value | 38 U.S.C. 3710(b)(5) | Current text, read 10/04/26 |
| Low appraisal options | VA.gov home buying process | Updated 01/07/26 |
| Tidewater, ROV, appraisal stats | VA report to Congress | April 2023 |
| Clark County fee and days | VA Appraisal Fees and Timeliness Table | Effective 05/01/26 |
| Nevada earnest money handling | NRS 645.310, NRS 645.630 | Current text, read 10/04/26 |
Frequently asked questions
VA amendatory clause questions, answered from VA and Nevada rules.
What is the VA amendatory clause?
It is contract language that protects your earnest money on a VA home purchase. It says you do not forfeit your earnest money, and do not have to buy, if the price is above the value VA sets.
VA calls it the VA Escape Clause. The wording comes from 38 CFR 36.4303(k).
Is the VA escape clause required?
VA says yes, when the contract is signed before you receive the Notice of Value. Buyer and seller must sign it, including on new construction.
If it is missing, the contract must be amended before closing, or VA will not guarantee the loan.
What happens if a VA appraisal comes in low?
You can ask the seller to lower the price, pay the gap with your own funds, or exit without forfeiting your earnest money.
You can also ask for a reconsideration of value first, with recent sales that support a higher value.
Do I get my earnest money back if I walk away?
If you exit because VA's value is below the price, VA says whoever holds the deposit must follow your contract terms and return it, if applicable.
Builder deposits for upgrades on new construction are not earnest money and are not covered.
Can I use the VA escape clause for a failed inspection?
No. VA says the clause may only be used when VA's value is lower than the contract price.
An inspection problem is handled by other terms in your contract, so ask your agent about those deadlines.
Can I pay the difference if the appraisal is low?
Yes. VA lets you go ahead by covering the price difference with your own funds.
The VA loan is based on VA's value, so the gap is cash you bring to closing on top of your other costs.
How much does a VA appraisal cost in Clark County?
VA's fee table, effective May 1, 2026, sets $750 for a single family home or condo in Clark County.
The same table gives the appraiser 6 business days to finish.
Who holds earnest money in Nevada?
Your contract names who holds it. Under NRS 645.310, a Nevada real estate broker must promptly put earnest money in a trust account at a Nevada bank or credit union.
The exception is when everyone with an interest in the money agrees otherwise in writing, such as having an escrow company hold it.
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Sources
- Electronic Code of Federal Regulations, 38 CFR 36.4303, Reporting requirements. Paragraph (k), the amendatory clause. Read October 4, 2026.
- U.S. Department of Veterans Affairs, VA Escape Clause, VA Home Loans. Page last updated January 14, 2026. Read October 4, 2026.
- Legal Information Institute, 38 U.S.C. 3710(b)(5), loan not to exceed reasonable value. Read October 4, 2026.
- U.S. Department of Veterans Affairs, Buying a home with a VA-backed loan, VA.gov. Low appraisal options and the escape clause. Last updated January 7, 2026. Read October 4, 2026.
- U.S. Department of Veterans Affairs, Congressionally Mandated Report: Recommendations for Improving Appraisal Delivery Times, April 2023. Tidewater, reconsideration of value, appraisal outcomes and timeliness. Read October 4, 2026.
- U.S. Department of Veterans Affairs, VA Appraisal Fees and Timeliness Table, effective May 1, 2026. Nevada and Clark County rows. Read October 4, 2026.
- Nevada Legislature, NRS Chapter 645, Real Estate Brokers and Salespersons. NRS 645.310(4) and NRS 645.630(1)(k). Read October 4, 2026.
Keep exploring
Appraisal
VA appraisal requirements
The property rules a Nevada VA appraisal checks.
Deposit
Earnest money and cash to close
Where your deposit sits and what is still due.
Costs
VA closing costs in Nevada
Common fees and what a seller can pay.
New homes
VA loans on new construction
Builder contracts in Summerlin and Cadence.
Fees
VA funding fee in Nevada
The 2026 chart, exemptions and how the fee is paid.
Next step
Check my VA loan options
Talk through your contract and cash to close.