Valuation nightmare!!! 23 September 2008 at 3:58PM edited 30 November -1 at 1:00AM in Mortgages & Endowments 32 replies 3.4K views

robertg

Hi there and help!

I'm new here and having a re mortgage nightmare at the moment.

Applied to Woolwich for a re mortgage. On line application made by my IFA last Wednesday. I put valuation as £220k. They have been very quick so far, passed the usual checks, valuer instructed last Thursday, he came and valued yesterday. The papers from their solicitor arrived this morning. Then I got a call from my IFA. They have had a call from the Woolwich. The valuation came in less than what we had put down. OK I thought, assumed it may have been about £10k under and had allowed for £20k under to still get to 85% LTV.

No, the valuer had valued our property at £165k!!! That's over £55k less. That's impossible. We bought it in Feb 2004 for £172 and spent £20k in June 2006 on extended new kitchen, bathroom, flooring etc etc etc.

Zoopla shows it's value as between £204 ton £222k. Other similar properties in the area detailed on nethouseprices.com in the last 6 months up to 500 metres away have all gone for between £200k and £220k. All that is apart from one!

The house next door but one was owned by a very elderly lady who had lived there her entire life and the house had not been touched in about 40 years. She went into a home earlier this year and the house was sold to a builder in June this year for £165k as it basically needed renovating from top to bottom.

As this is exactly what he has valued our house at it seems this is where he got his figure from. He was only here for 5 minutes and isn't even local so has no idea of local house prices.

My IFA hasd put in a strong appeal to the underwriter using all tha above valuation evidence but I'm not confident. I can't appeal to the valuer directly as it was a free valuation provided by the Woolwich.

The valuation is so obviously wrong it just unbelievable. Any advice on where I go from here? We are going on holiday at the end of this week and I wanted to go away knowing we had an offer. Now we are back to square 1 again.

Robert

going2die_rich

It's just the banks protecting themselves. They will no doubt be using the lowest possible value your property could reach if the worst case scenario was to happen during the price drops occuring. After all, if they lend you more than that, it exposes them to risks and unless you are the biggest banks about, you can't afford to take such risks. So to protect themselves they wont lend you more than they are certain they can recoup from your property sale f the worst was to happen.

I'd say try a different bank, probably someone like Abbey which seems to be wethering the storm better since it has the finances to buy others.

arkie

from what I understand and speaking to a valuer , they are vauing properties at what they think it will be worth after the credit crunch (2010) , this has come from a very reliable source

mortgagemark_2

I would be wary of Abbey as they have been the worst for down valuations recently and charge £150 upfront.

Worth trying another lender tho - Good luck

look_after_the_pennies

Hi Robertg,

Don't worry, you aren't the only one this has happened to! Just had a phonecall from our IFA today. We are in the process of remortgaing and were looking at a 10 year fixed deal with the Norwich and Peterborough. Our house was bought for £130,000 although it was valued at £140,000. We have just been told that we now need to look for a new lender as Norwich and peterborough have valued our 2 bed semi with garage at £115,000!!!!

SouthCoast

This is a Zoopla valuation.
The property has been on the market for 2 years and not found a buyer at £180k.

Flat, Leasehold, 2 Beds, 2 Baths, 1 Receps -
Last sale: £199,999 Sale date: 18th Dec 2003

Zoopla! Estimate
£253,830

robertg

Thanks. I understand that they are being careful and as I said was prepared for a drop of up to £20k, but £55K! It's just mad. Our house and the one next door but one bear no comparison with each other.

Surely the sold prices of all the other properties in the area should count for something and they shouldn't just base the value on just 1 property.

I went with the Woolwich / Barclays partly because they were so big and wouldn't be at risk like some of the others. We are with Northern Rock at the moment.

I am also nervous about trying different lenders as this is our second mortgage application recently and I don't want to hurt our credit report. We applied for the HSBC lifetime tracker in August. They declined us due to advers credit. It turns out Barclaycard had put a load of late payments on my credit hostory in error. I complained to Barclaycard and the markers were removed from my credit files but HSBC won't go back on their no, so I applied to Woolwich assuming we wouldn't have a problem as the credit files were clear.

It seems my only hope is that I can convince the Woolwich their valuation was wrong.

I have had countless mortgages over the years and never experienced anything like this.

dunstonh

No, the valuer had valued our property at £165k!!! That's over £55k less. That's impossible. We bought it in Feb 2004 for £172 and spent £20k in June 2006 on extended new kitchen, bathroom, flooring etc etc etc.

To be honest, I think you are expecting too much. Unless you are in a property hotspot, a rise from £172k to £220k seems very high in the last 4 years. Break even would be closer to the mark.

sdooley

If you spend £20,000 on improvements you won't add £20,000 to the value of the property. Not in this market.

robertg

dunstonh wrote: »

To be honest, I think you are expecting too much. Unless you are in a property hotspot, a rise from £172k to £220k seems very high in the last 4 years. Break even would be closer to the mark.

I wouldn't have said we were in a property hotspot and perhaps £220k was a little optimistic in the current climate but it's certainly not worth £165k either. Based simply on other properties in the area sold recently I would have said £200k was about right.

An identical house just 8 doors up sold a few months ago for £215k but the valuer seems to have ignored that.

tinkerbell84

A lot has changed in the past few months