How to appeal a mortgage valuation?

LeserattePD

Hi everyone,

Could anyone give me some advice on how to successfully appeal a valuation survey?

The situation is as follows:

We are FTB with a 25% deposit and have an agreement in principle for a mortgage from NatWest. We are trying to buy a new-build two-bed two bath (full bathrooms) flat in Ruislip Manor (west London) which is 2 min from an underground station, with a balcony and a parking space, 79 sq m with really top-end finish, facing to the back of the development (24 flats) onto a roof terrace that covers the parking area on the ground floor. There is a bed shop on the ground floor as well, facing the road. We've negotiated a discount on the list price and are getting the stamp-duty paid by the builder.

We've just received the valuation report and it came in at 10% less than what we agreed to pay. You're going to say that maybe the property is only worth that much, however the people buying the exact same layout flat, next to the one we want, agreed to pay full list price with no incentives and their valuation came in at full price!:mad:

Also, information in the report is clearly wrong (ie the quoted list price is higher than the actual list price). And according to the estate agents the surveyor used a part ownership development accross the road and a massive Wimpy development more than a mile from the underground station as comparables. The agents said he'd given the surveyor a list of over 30 comparables and the surveyor just ignored all of them.

I picked one of the flats in the part-ownership development and the Wimpy development that might be remotely comparable (it's got no balcony and only one bathroom) and added up the total area of the flat (60 sq m). I then divided the sale price by this number and multiplied by 79 (the sq m of the flat we want) and came up with a number thats actually 5% over the list price for our flat! And I've seen the flats in the Wimpy development - the spec we're getting is so much better.

Anyway, apparently the builder is discussing the valuation with the surveyors regional manager and also has offered to pay the valuation fee for a different mortgage application. However, seeing as that surveyor is used by all the major banks except Halifax and C&G this limits us in the choice of mortgage and means we'd only get a deal that is 0.9% worse than what we'd get at Natwest.


What is the best way to dispute the valuation report?

Thanks for any help

LeserattePD

Cannon_Fodder

Does the fact that the Builder is willing to pay for a re-valuation, not ring alarm bells?

Their desperation is a clue.

The EA works for the Builder, not you. Take anything they say with a pinch of salt.

The surveyor has a responsibility to the lender, indeed they can be sued if they get it wrong, so perhaps inconveniently they lean towards under-valuing whilst the market is still shaky.

This is a Money-Saving website, you should try asking the builder to accept the valuation...then buy the surveyor a pint, to thank him for saving you money.

If you asked the RAC or AA to report on a vehicle you were going to purchase, would you say "I don't care what's wrong with it, I want to pay more..." ??

_Andy_

Totally agree with Cannon Fodder.

Not only are you buying something that will instantly devalue, but you're willing to pay more than a professional says it's worth to boot.

LeserattePD

Cannon_Fodder wrote: »

Does the fact that the Builder is willing to pay for a re-valuation, not ring alarm bells?

Their desperation is a clue.

The EA works for the Builder, not you. Take anything they say with a pinch of salt.

The surveyor has a responsibility to the lender, indeed they can be sued if they get it wrong, so perhaps inconveniently they lean towards under-valuing whilst the market is still shaky.

This is a Money-Saving website, you should try asking the builder to accept the valuation...then buy the surveyor a pint, to thank him for saving you money.

If you asked the RAC or AA to report on a vehicle you were going to purchase, would you say "I don't care what's wrong with it, I want to pay more..." ??

Well, I wasn't born yesterday. Of course the estate agent wants to get his money by selling us the flat. However, we've looked at quite a few properties in the area (including that Wimpey development) and the flat is worth that much. Also, the other buyers had no problem with their valuation (yeah that's what the agent said but they're willing to provide the valuation report for that so I hardly think they're lying). I think it is unlikely that the builder will drop the price any further. I'd love to get it cheaper of course, but it ain't gonna happen.

Any more constructive comments?

Trollfever

You could ask an independent professional to do you a valuation for mortgage purposes.

http://www.rics.org/

OMAR

they are constructive?......so what about next door and what you think?...the professionals arnt agreeing

Cannon_Fodder

Get the next door valuation...if they have it.

Do buyers regularly pass their personal survey documents to EAs? I never have, except to negotiate down a price...

...unless, conveniently enough, they had arranged their mortgage through the EAs in-house mortgage advisor...who is hardly going to let their partners down by picking a lender/surveyor who doesn't cooperate.

I do hope the whole site isn't the subject of a scam/fraud...
http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/6066663/Mortgage-fraud-how-lenders-have-been-caught-out.html

LeserattePD

Trollfever wrote: »

You could ask an independent professional to do you a valuation for mortgage purposes.

Thanks a lot Trollfever. That is very helpful.

dunstonh

We are trying to buy a new-build two-bed two bath (full bathrooms) flat in Ruislip Manor (west London)

You have just sworn twice in one sentence. "New build" and "flat". The two things that suffer most in a house price drop.

Estate agents and builders over price. They expect to be knocked down in price.

No professional valuer is going to price favourably on a new build flat when house prices are dropping.

BTW, I used to live out that way over 20 years ago when you used to be able to do shopping in Ruislip Manner (two Tescos, a Woolworths, Menzies etc all gone now). I went down there some years back and the wide pavements were empty and the shops were mostly restaurants and pubs. Couldnt believe the change in Woolworths to a wooden fronted pub.

brit1234

LeserattePD wrote: »

Hi everyone,

Could anyone give me some advice on how to successfully appeal a valuation survey?

We've just received the valuation report and it came in at 10% less than what we agreed to pay.

LeserattePD

LeserattePD
At the moment you are making me very angry. :mad: Flats and especially new builds are overvalued in West London. The survey takes account of this and gives a closer valuation than the building sites inflatted one. Now when you get told the flat is worth less than what you want to pay then you have to negotiate the price down or find the extra money needed. Why should the bank take on your extra risk on a property that is likely to fall in value. This just distorts area prices upwards.

What makes me angry is that you are trying to ramp prices up in a area I am struggling to buy in. I am just short despite having saved a big deposit and a good wage. Stop being so selfish, arrange to buy at the valuation price and thus help first time buyers in the the area rather than hinder them.

northerner79

Re-negotiate on price in light of the valuation if possible, this may involve changing mortgage deals but may lead to a reduction from vendor of 5%-10%, for purchasers of new properties, especially flats they should be aware that lenders and boards are putting increasing pressure on to get funds in, as they say cash is king. Which developer has carried out the development where you are hoping to buy?