New Builder price reduction

aladinliverpool

hi there.

builder had some houses for sale at 135000
Some have now been sold at this price.

builder has now reduced price to 116950 to get rid quick so they can get on with the rest of the new estate.

Therefore.. what value do i state to a mortgage lender when i apply for a mortgage of 75%. the 135000 or the 116950?

Do i apply for a mortgage of 87k for a property priced at 116950.. Thats i state the value is 135950?

id like to say the value is 135000 as this was the price only till 10am today. The builder just wants to move on to the other side of their development plan.

Could i be onto a winner here? would it look good to a lender if im asking for a mortgage for 87k for a house thats worth 135000k?
your thoughts please? im all confuzed

opinions4u

The lender will go off the lower of valuation or purchase price.

Your solicitor has to verify the purchase price.

In other words, tell the truth or they will find out.

aladinliverpool

Thing is... The houses are valued at 135000 on their website. Its the builder who has reduced the price to 116950 to get a quick sale.

Its not lying if the guy next door paid full price whereas if i go for it and get it for 116950 surely? Id be telling the truth. the value of the house as listed is £135000. im just getting a good discount to buy it quick?

ill speak to my broker tomorrow and see what she thinks. thanks

opinions4u

aladinliverpool wrote: »

Thing is... The houses are valued at 135000 on their website. Its the builder who has reduced the price to 116950 to get a quick sale.

The lender will ask you what the purchase price is. They will ask the valuer what the valuation is.

Its not lying if the guy next door paid full price whereas if i go for it and get it for 116950 surely? Id be telling the truth. the value of the house as listed is £135000. im just getting a good discount to buy it quick?

It doesn't matter. The lender will use the lower of the purchase price or the valuation. End of story.

ill speak to my broker tomorrow and see what she thinks. thanks

You do that.

_Andy_

It's a new build - if you want to kid yourself that you're getting a great deal (especially in a falling market) then go ahead.
As stated, the lender will use the lower price. Not entirely sure why you'd come on here for advice and then not trust the answer (unless it's because you don't like it).

_Andy_

aladinliverpool wrote: »

Thing is... The houses are valued at 135000 on their website. Its the builder who has reduced the price to 116950 to get a quick sale.

That should be a clue to you that it's not 'worth' £135k .

aladinliverpool

Surprise Surprise.

Spoke to the broker. she has informed me that the valuations already done on other same design properties next door actually put them above list price. They are worth a lot more than what the builder is selling at. Due to the area and designs. The lenders obviously took the builders price into consideration as they would be helping to purchase a property way below its valued price. Bargain!

opinions4u

aladinliverpool wrote: »

Spoke to the broker. she has informed me that the valuations already done on other same design properties next door actually put them above list price. They are worth a lot more than what the builder is selling at.

So you're basically saying that your builder is stupid then. Why sell an asset for less than its value?

The lenders obviously took the builders price into consideration as they would be helping to purchase a property way below its valued price. Bargain!

Lenders will based the LTV on the lower of valuation of purchase price. If 2 parties out of the 3 involved (solicitor, broker, lender) can act illegally then you will achieve what you want. Although you would also be party to it.

Treadmill

opinions4u wrote: »

So you're basically saying that your builder is stupid then. Why sell an asset for less than its value?

Lenders will based the LTV on the lower of valuation of purchase price. If 2 parties out of the 3 involved (solicitor, broker, lender) can act illegally then you will achieve what you want. Although you would also be party to it.

Why sell an asset for less than its value?

A distressed sale for one reason