Home devalued by surveyor and now lost mortgage!

pretty_mumma · 9 September 2009 at 8:17AM

I wonder if anyone can help us.

We recently applied for a remortgage with First Direct. Everything was going really well and the only thing left to complete was the Surveyors visit.

We received a letter from FD asking us to contact them. We called and was told that the valuation was too low for the mortgage we wanted.

Basically, we had our house valued by Estate Agents, Zoopla, and checked on Rightmove. They all said our house value was £200,000.

FD's "independant" surveyor told them that our house value was £175,000. So now we cannot get our house remortgaged.

Does anyone know what we can do about this? I know from the news that banks are telling surveyors to devalue by 10% but to add insult to injury he took 12.5% off.

Basically, we are stuffed because of this and really dont know what to do next.

Please help!!

SandC · 9 September 2009 at 9:21AM

You could go on SVR and see how the land lies in a few months? Many people who are going onto SVR after a fixed rate are finding they can overpay quite considerably. You might then find that things have improved a bit with regards to the lender valuations if you come to a point where you feel that fixing is the right thing to do.

dunstonh · 9 September 2009 at 9:26AM

Basically, we had our house valued by Estate Agents, Zoopla, and checked on Rightmove. They all said our house value was £200,000.

All of whom over price properties. An estate agent will value it at a price expecting a 10-15% reduction on offer.

Zoopla has my property value at around 20% higher than its real worth.

FD's "independant" surveyor told them that our house value was £175,000.

Which seems realistic given the price you mention with the estate agent and zoopla.

I know from the news that banks are telling surveyors to devalue by 10% but to add insult to injury he took 12.5% off.

the banks do ot tell them to devalue by 10%. They have a criteria and will value on that criteria.

In a rising market, there is often a margin of error upwards and in a falling market it goes the other way. So, you may find a valuer will value a property at slightly less than you would get today on the basis that in 3-6 months it is likely to be worth 5-10% less.

Mrs_Bumble · 9 September 2009 at 10:34AM

Not sure if this article might be of some help?

http://www.thisismoney.co.uk/mortgages-and-homes/mortgages-features/article.html?in_article_id=489770&in_page_id=58&ito=1723

SandC · 9 September 2009 at 11:35AM

I would never get info from Zoopla. I live in a block of 4 small terraced houses and the so called current values of them are between £74,481 and £91,809 with mine being the high one. Which is a load of codswallop and based on I do not know what seeing as it hasn't had a surveyor in it since about 2000. Plus it's the same as all the other 3 - maybe they are presuming I have a super duper kitchen and bathroom or summat - nope.

pretty_mumma · 9 September 2009 at 12:21PM

Thanks guys.

I also forgot to say that we also have a conservatory and that the house opposite sold six months ago for £197,000.

I have also looked at what others have said about Zoopla and the majority are saying they undervalued, not over.

For £175,000 according to recent sales in my area, you would be buying a 2 bed, not 3 with improvements.

We know they've majorly undervalued. I just want to know what we can do.

geoffky · 9 September 2009 at 12:25PM

if you were buying with your own money you would be made up...they have stopped you overpaying for a house saving you 75k over the term of the mortgage..

PeteHi · 9 September 2009 at 12:29PM

had a similar problem with First Direct and the original drive by valuation being lower than we required. So after speaking with FD about it, we paid for another (internal) valuation to be done and eventually got the value we required. Can you not give this a try?

Twopints · 9 September 2009 at 12:30PM

geoffky wrote: »

if you were buying with your own money you would be made up...they have stopped you overpaying for a house saving you 75k over the term of the mortgage..

Er, it's a re-mortgage...

SandC · 9 September 2009 at 12:30PM

pretty_mumma wrote: »

Thanks guys.

I also forgot to say that we also have a conservatory and that the house opposite sold six months ago for £197,000.

I have also looked at what others have said about Zoopla and the majority are saying they undervalued, not over.

For £175,000 according to recent sales in my area, you would be buying a 2 bed, not 3 with improvements.

We know they've majorly undervalued. I just want to know what we can do.

Are you currently with FD or are looking to move to them? If you are moving what will you be moving to as SVR with your current lender? Or if you are already with FD wouldn't it make sense at the moment to go onto their SVR?

I would tend to agree with you that they are undervaluing massively but the problem is there is nothing you can do about changing their valuation. That's why I suggest biding your time on SVR if you've no other moving options with other lenders who might come out with a better valuation. Oh, but Pete's suggestion is well worth trying seeing as he's done it himself. They won't accept EA or Zoopla but a proper surveyor valuation is different.

pretty_mumma · 9 September 2009 at 4:08PM

No, we're currently with Northern Rock and are looking to move. Due to circumstances beyond our control we need to reduce our outgoings. We've seen an IFA today who was very helpful. We've been offered an Interest only for 12 months by NR and he feels this is our best option at the moment. He also said because FD gave us such a low valuation, its likely other companies will.

FD have been no help whatsoever, even though we've been a good customer for a long time.

Home devalued by surveyor and now lost mortgage!

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