In real estate transactions involving Veterans Affairs financing, a V.A. escape clause is a provision that protects the borrower if the property does not appraise for at least the agreed upon purchase price. It ensures that the borrower is not obligated to complete the purchase under those circumstances.
If the appraised value is less than the contract price, the borrower may cancel the transaction without forfeiting any deposit. This clause is intended to safeguard veterans from paying more than the appraised value of the property.
