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The Valve Texture Format (VTF) is the proprietary texture format used by the Source engine. In case some of you might want to convert mdl files for Sims 4.
I firstly discovered this problem a long time ago. I was just about to snap a bake button when I saw that the texture is half-transparent in the UV editor. Model is different but the texture looked something like it:
"Why? How? The model looks fine. It has no visible transparency." It does indeed, but when you try baking VTF something strange happens. Baked texture looks like someone lowed down the brightness and half of it gone completely black. So how do we avoid baking transparency channel? Quite simply, honestly.
Save all the VTF textures you are going to bake in TARGA (TGA) format. Why not png / jpeg? Because only a TGA format preserves the transparency channel we need. Another way of doing it - use VTF Edit utility.
Open our exported TGA in Photoshop (or any other image editor that can work with channels)
Go to channels. What do we have here? An alpha channel. This is what cause our texture to darken. Simply delete it.
Now you can save edited texture in any format comfortable to work with.