valuation query

ninjax

folks, i'm hoping you can help?

we are worried,

some info:
we purchased a 3 bedroom detached bungalow and a small cottage (2bed at the bottom of the garden)within 2 acres of land, we purchased the complete package for £335K in Dec 2006.

we purchased this Privately and feel we purchased @ bargain price in 2006.

Based on some good advice of the Solicitor we split the Title deed into 2 separate Deeds to avert paying the higher Stamp Duty.

So in essence we split the Deeds £235k Mortage for the Bungalow and £100k for the Cottage. So the 235 is not a true reflection of the value of the property!



Where the problem arises comes from the valuation of the Bungalow via the banks when remortgaging they are basing it on the skewed value of 235- and they are now valuing it @ just over £200k impacting our LTV -


the other problem we are having is we are surrounded by new Flat Complex's - which are depressing the sell-on prices in this area.
we have 2 complex's half empty and the other 1 completed but totally empty.
its ruined the nice village!! but that's another issue.

do we need to get a valuation?
by whom and will we get an impartial /balanced value!!

apologise for being negative - on this topic, but the banks are just making hard work of something very simple.

any help appreciated
Brian

Robert_Sterling_3

Oh what a tangled web we weave

( Me included so no offence intended )

Rossa_3

With all due respect to your solicitor, in hindsight his advice was not that good, was it really. To avoid paying stamp duty on the 335k, you have now effectively got 2 separate properties and I assume they have been registered as such at the Land Rregistry as that is where the Inland Revenue check the records to see if you are avoiding paying the right amount of tax (stamp duty) on a transaction.

So I'm sorry to say that in the current climate 200k may be the right valuation for the bungalow on its own. So on the bungalow you now have a valuation of 85% of the original 235k. And applying the same 85% valuation to the cottage means that it is likely to be worth 85k now.

So you now have 2 properties worth 285k. How much equity did you put into the properties? That will tell you what your current LTV is.

I can only suggest that you shop around and see if you can find a lender prepared to lend across the 2 properties. That will depend on what you use the cottage for. You may need to use a broker and there may be someone else on this forum that can help you with that. My own contact is Alasdair Devine at Property Investment Finance on 01786 832 233. His company does do unusual finance packages and he may be able to help or know someone who can.

All lenders need a valuation particularly in a falling market. They won't take an independent valuation so save your money. They will only use a valuer they know as their lending decision i.e. managing the risk, is based on the figure their surveyor says. This is not necessarily the same as a market valuation. People often think they are the same, but they are not.

ninjax

Rossa, thxs for the advice,

the cottage is a working BTL ( on a separate Mortgage to the Bungalow) and gives a handsome return, we originally intended to sell this- as it has separate access- this was also the other reason for splitting the DEEDS.

on the Equity front -

we placed 50K on the cottage to get a good BTL deal with the Coventry-

on the Bungalow we deposited 80k-

Rossa your valution comments are incorrect:mad:
we are seeing 1 bed flats selling for £100k (and you can't swing a cat in them)

we are looking to get into a 60% LTV but look to be missing it by a few percent