Advice on Mortgage Valuation

SallyKate888

Hi All,

Just wondered if anyone could give me some advice on my current situation. I am rather confused !!

Just had mortgage offer through today for the same price as I offered for the property (100k). Anyway after looking through the offer letter and mortgage valuation report, have noted that the surveyor recommends that 3k be held back for remedial works, and actually values the property 3k LOWER than my offer of 100k, in its 'current condition'. Despite this it seems the lender is still prepared to lend us the money and there is a specific term in the offer, that confirms they will not be holding back any of the funds, but that we should get estimates for the work and get these carried out. I have also had this confirmed by my broker. Is this normal?

I have been back to estate agents as obviously as a buyer I don't want to be paying through the nose for the property, and have asked for a 3k reduction on the price. Is this reasonable? I think so, but would welcome opinions.

Also, I was keen to get my solicitor sorted to get searches going etc, but not sure how safe it is to do this until price is confirmed etc...! Don't want to waste cash!


Any advise much appreciated!

pawpurrs

You seem to contradicate yourself, on one hand you say it was valued at the same price as you offered on it, then you say it was valued at 3k less?

It can be normal yes, what work is it that needs doing? Can I ask which lender?

SallyKate888

God sorry, indeed I do.

Mortgage company agreed to give me mortgage for 100k.

Mortgage Valuation states that in current condition house is worth 97k.

So, is it normal for lenders to still release all funds in this instance?

And, am I reasonable to ask the seller for a reduced price given mortgage valuation?

Hope that explains it a little clearer?!

pawpurrs

The lender is happy to lend you the money, but may well want to see evidence that the work is done within a certain period, best to check this with your broker.
You can ask the vendor to reduce the price, but they may or may not agree to this, so then you will have to decide if you want to go ahead or not, what work is it that they are saying needs doing? Nearly all surveys will come up with something, and unless its major, is to be expected on old houses.

JayZed

Yes, this is not uncommon and isn't anything to worry about unduly. However, you should get a couple of quotes for the work that they want done. If the cost is going to be significant (i.e. more than a few hundred quid), then you may want to re-open negotiations with the vendor and see if you can get them to knock some or all of this cost off the sale price.

Doozergirl

What needs doing to the house? It isn't very serious if the lender has ignored the surveyor.

The lender will likely say on their mortgage offer that they want the things rectified within 6 months. The reality is that they never check.

SallyKate888

As per valuation report...

Checking of solid stone flooring to see if a damp proof membrane needs putting down, check dampness and conditions in all timber work, check roof coverings and carry out repairs, repair chimney stack and provide ventallation to flues, check heating and plumbing systems and carry out recommended works.

That's it....

poppysocks1

I had a similar situation, put offer in on house, full survey done and extensive work needed doing - more than we could afford, and luckily at this stage we had not instructed the solicitor so only lost out the cost of the survey. I think you need to be really sure how much the work is going to cost - the roof work could be expensive as scaffolding needed to be put up - you mention to check roof coverings - is this new tiles or new underfelt? Chimney stack repairs? It says "check heating/plumbing" - do you think these need repairs as this could be expensive. Also what if the stone floor needs a damp proof membrane - this is expensive/messy to do. (i had to get quotes for similar that showed up in the survey we had done).
Just be sure before you start the solicitor doing searches as you dont want to lose money on this.

What type of house is it and how old roughly?

pawpurrs

Sounds like a bog standard survey then, its not actually saying ANYTHING at all.......just saying check........covering themselves. useless

SallyKate888

See that's kind of what I thought to be honest... although poppy socks has suggested this is risky... the house belonged to an old lady and me and my other half are buying it to do it up... so we expected work to be done, including what the surveyor pulled up, to a certain extent. I think we'll go back to the seller and try and get a bit more knocked off on the basis that the valuation report states that the property is worth 3k less minus any remedial works as per the survey.

The EA is organising a guy to go round and cost for the remedial works so I suppose we'll take it from there...

Hating this house buying business - so stressful ( I am a worrier though!!!!)

poppysocks1

Sallykate - I didnt want to worry you, but also didnt not want to say what happened in my situation. I think the best thing to do is get the quotes tomorrow and then go back to the estate agent with a new offer based on what work URGENT work needs to be done. You can still instruct the solicitor but only when you are happy to proceed, it may just mean waiting an extra day or two.

I do agree that surveys list EVERYTHING but some things just may be more expensive to fix (i.e roofs as they involve scaffolding!) and sometimes it isnt clear of the extent of what work is urgent or whether it would just be "nice" to get done "at some stage" if you know what i mean.

I am also a worrier -and the house we didnt go ahead with needed about £25k worth of work doing BEFORE even a new kitchen/windows were put in, so I think i was just very unlucky, but there was lots of structural things in the survey and to be honest we could not justify the extra expense (even iwth a lower offer). The kitchen needed a new damp proof course/rewiring/plumbing then new kitchen and that was just the start of it!!

Good luck, i hope you manage to sort it all out and I am sure it will be fine.