IFA says don't bother with survey?

Eels100

Hello everyone - newbie here, please be nice

I have a query ... I am an FTB in Scotland, with all the attached complexities of buying a house that seems to entail.

I have found the house, and the mortgage (via an IFA). He will use his chosen solicitor which will apparently make life simpler. I am in the process of trying to informally agree on a figure with the vendor (via the EA) but have only had a valuation survey carried out (again, arranged by the IFA).

I asked the IFA at what stage should I consider a further survey (as I understood it, a valuation wasn't going to yield any worthwhile info). He seemed surprised I asked this - apparently virtually nobody has ever asked him about it, and as far as he's concerned, if there was anything dodgy in the property the surveyors would have notified him that a fuller survey was necessary. He thinks spending another £500 on my already tight budget isn't worthwhile.

I had never intended to go for the full gold-star structural report shebang (the house is only 12 years old) BUT I have a nagging feeling that the valuation won't be thorough enough. As the IFA says, it has to be thorough enough to assure the lender that they'll recoup their cash if they reposess, or the surveyor's liable, so am I just being paranoid? Others have told me that they never had a fuller survey done either ... am I just trying to make life difficult for myself?

lynzpower

Well, Im not 100% but can only give my opinion.

A valuation survey to my knowledge WILL NOT suss out whether the house has any structural, electrical, roofing & guttering etc probs. It will only establish whether the house will get the money back for the lender if they reposess it. Ie my flat marketed at 199.950, valuation survey, said 197500 which was what they thought the place was worth/ will get back should they need to reposess.

The surveyors MAY have notified him, or I guess they may not.

Personally, I think £500 of my money is worth if for the peace of mind, and when I move next time, Ill be paying it just to be sure. You never know it could throw up something you might be able to get a discount on the purchase price on, so not always a waste of money

RiskAdverse100

As the IFA will have a vested interest in the transaction actually completing I would treat with a huge pinch of salt any advice that he may offer on surveys.

What he does not want is for you to withdraw from the transaction because, for example, a structural problem with the property is discovered. A building survey or a homebuyer's report ought to pick this up but a valuation survey might not.

RiskAdverse100

silvercar

If the IFA is prepared to say in writing that there is no need to have a further survey, he could welll be liable, if there turned out to be a problem large enough to have caused you not to buy the property had you had a full survey.

There is a point in saying that, with a very high loan to value ratio, the mortgage provider is sharing the risk. With a lower loan to value you are bearing the risk yourself hence people tend to have fuller surveys. That would explain why it is usually the very high LTV mortgages where the valuation often undercuts the agreed price by a few thousand. You don't usually hear of cases where a property sold for £300k with a mortgage of £150k gets valued at £298,500!

Wickedkitten

RiskAdverse100 wrote:

As the IFA will have a vested interest in the transaction actually completing I would treat with a huge pinch of salt any advice that he may offer on surveys.

What he does not want is for you to withdraw from the transaction because, for example, a structural problem with the property is discovered. A building survey or a homebuyer's report ought to pick this up but a valuation survey might not.

RiskAdverse100

It certainly does seem like that considering by the look of it, the OP can't even use their own solicitor as "He will use his chosen solicitor which will apparently make life simpler."

If he had let you know (to the OP) that you could have had the homebuyer survey done at the same time as the valuation, that would have saved you money.

Red_Elle

I am in the same situation and I don't doubt my IFA at all. He has proven beyond reasonable doubt that he is honest and wants to get me the best deal. We are buying a house that is less than 15 yrs old and he said to go with the mortgage valuation type survey only.
It has come back and is more detailed that I expected. I think he has told me this because the house looks in very good condition and he said if the report came back with anything even slightly concerning we can get a more detailed one.
It hasn't and I am happy with his advice.

RiskAdverse100

I am afraid that this does not change my views on IFAs recommending mortgage valuations only.

Did your IFA explain to you the purpose of the mortgage valuation? Did he make it clear that, although in most cases you pay the cost, it is carried out only for the lenders? Did he make it clear that, if the valuer was negligent and failed to spot a serious problem with the property, it would only be in exceptional circumstances that you would be able to sue him, because the report was carried out for the lenders and not you? Did he mention that, for a LTV of less than 80% or so, the valuer may only spend a few minutes in the property?

Any IFA discussing surveys with clients who does not explain in detail the various surveys availalbe and point out their advantages and disadvantages and then let the client decide which survey to have is not acting in their client's best interests.

RiskAdverse100

AndrewSmith

The IFA would say that as he is not the one buying it.

I always advise my clients to consider the following 'general' rule of thunb based on the age of the property:

0-10 years old, basic valuation (as it should have some form of guarantee)
10-60 years old, homebuyers report
60+ years consider a building survey

I always advise clients that spending a little more now on a more detailed survey could save them in the long run.

Andy

CTT_2

Uuuuuuuuiii

Eels100

Just to clarify:
LTV will be 100% (eek!)
IFA has been quite crabby about whole thing ("You've just finished telling me you want to save money by offering less than what you know the vendor wants, and now you want a survey ...?!")
I want to move quickly but from what's been said it sounds like my gut feeling about this guy isn't far off the mark. I don't want to rock the boat - if the vendor comes back to me with a figure we can agree on it'll be based on my assurance of a quick sale, so I'm worried I'd hold things up if I decide to change to a mortgage broker at this stage ... :-(

AndrewSmith

I think it's time you had the 'remember who you are working for, don't forget from whom you earn your commission' chat with the IFA. How dare he speak to you that way. Unexcuseable.

If you want a survey and especially as you are financing the purchase 100% the you should do what you want, not what the IFA thinks is best for him.

Tell him to bog off, and that you will have a survey if you damned well want one.

Either that or ask him to sign a sworn statement that the property does not have any defects and that you do not need a survey. They when you have a problem with the property, wave it infront of his nose across the court-room as you are suing him.

If you want to change to a broker, do so now and get your new broker to contact the vendor / agent before you tell the IFA, to assure them that all is well and you changed due to the ridiculous attitude of the IFA. This way he can do no damage and will make himself look a complete prat if he then goes whining to the vendor/agent trying to blow the deal for you.

Andy