Remortgage - valuation?

dave76

My tracker deal doesnt run out until december but just wonder how things work when it comes to remortgaging.

When I bought the house 18 months ago, it was on the market for 200k, we bought for 180k and took a mortgage for 150k (83% LTV). The mortgage company had it valued and they came up with the same value of 180k (although it was marketed at 200k - how can they just happen to value it at the price we paid).

Now, if I want to remortgage come the new year, and I stay with the same company, will they send somebody around to revalue it and how can you trust that they will do an honest assessment (rather than say all property in the region has fallen by 25% so yours must now be worth 75% of what it was 2 years ago)? I could put the place on the market at 180k now, and it might not sell but valuations are a pretty subjective thing arent they? I assume they would be more than happy to leave me on the SVR if my LTV was too high to get a good deal, so there is no extra risk on their part really.

Not really worried to much as the SVR is pretty low anyway right now...

belfastgirl23

dave76 wrote: »

how can you trust that they will do an honest assessment (rather than say all property in the region has fallen by 25% so yours must now be worth 75% of what it was 2 years ago)?

Would that not be an honest assessment though? If all property in the region has fallen by 25% the yours should have too

My experience though is that my lender (nationwide) hasn't shown any interest in re-valuing the house either time I've come off a fixed rate. I think you would probably be more affected if you were thinking of moving lender. Others might know different though

_Andy_

£180k sounds pretty accurate.

Mrs_Bumble

You can get an idea of what the likely valuation is going to be from sites like https://www.zoopla.co.uk , an estate agent will give a valuation for sale purposes but when a lender requests a valuation it is for mortgage purposes and this will be more conservative. A house valuation might be subjective, which is fine when you have the cash to back up any down valuation. When you need it for remortgage purposes you are pretty much stuck with the valuation as given.

You would need to check with the lender at the time as to whether they will actually require a valuation carried out but even if they don't they will use statistics to work out what they think that it is worth at the current time which pretty much is likely to be what you paid for it.

dave76

that doesnt sound too bad then - I was just a little concerned they would mark down what I actually paid by the "general area price drop" regardless of whether I got a good deal in the first place.

There is also the fact that for example "prices in the NW have dropped by x%" but its quite likely that certain areas within the NW have kept their value or not dropped by the same percentage, and just how fine do they split up their generalisations.

Weresmydosh

I recently applied to remortgage with same lender due to term coming to an end, the deals they offered my were not very good, when I questioed why they told me I had next to no equity in my house as it was now only worth 180k paid 247K for it nearly 2 years ago and done extra work on it.
They said the only way was to have there valuation company re-value it at a cost of £95.00, did that he said worth 225K now a saving on mortgage fixed rate of £97 a month compared with rate offered before valuation.