How to appeal a mortgage valuation?

LeserattePD

northerner79 wrote: »

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?

Well the point about this flat is that it isn't your standard tiny high-rise with crappy finish. In this case when they say luxury it really is. Developer is qdevelopments (sorry can't post links on here), but go and have a look at their website.

The whole problem is that the people buying the flat right next to ours (same layout and everything) got their valuation at full list price. We already negotiated a good discount on list price and also get the stamp duty paid, yet our valuation came in 10% below the agreed price (that's about 20% difference in valuations on completely similar flats).


I'm all for lower houseprices, as there was no way we could have afforded anything so nice two years ago. I also don't mind if the houseprices fall another 10% or 20% in the next two years. That's the amount we'd spend on rent during that time and the flat we're renting is not nearly as nice or as big. I'm not buying an investment here, I'm buying my home for the next 8-10 years.

LeserattePD

brit1234 wrote: »

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.

I'm not trying to ramp prices up. I'm a first-time buyer myself and believe me getting together the 25% deposit for buying wasn't easy. But maybe you want to judge for yourself if this flat (qdevelopments . com - Current developments) is worth more than a part-ownership home (windmillapartments . co. uk) or a wimpey flat (georgewimpey - west london - eastcote)?

Remeber the flat we want is a good 20 sq m bigger, has a second bathroom and a balcony.

LeserattePD

I have to say that I'm starting to feel a bit harrassed here. All I did was ask for very specific advice. About the only helpful answers were Cannon Fodder and Trollfever. Nearly everyone else is happily riding their hobby horse and lording it over the poor stupid wrench who doesn't know what she's doing.

Just to let you know that I have my finances firmly in hand and never ever had to resort to a loan even when I was living with my partner on a student's stipend. I know how to work and how to budget. I wouldn't buy if I wasn't sure that we could afford it with a good safety margin (incidentally our safety margin is 100% ie we could afford to pay the mortgage even if rates went up to 15% - unlikely I think as this would seriously crash the housing market). We could afford it if one of us lost our job - highly unlikely again, as I work for a university on an already funded project and my partner works for a company that's doing really well.

malkie76

I genuinely think the people here are trying to help and be constructive, but giving you realistic advice that you don't like the sound.

I'd view this as an opportunity to beat your builder into submission to offer you the flat at the valuation and save yourself a bundle of money. The whole thing with house prices is that the valuation your neighbour got last week is irrelevant - the valuation you had this week is the one that counts.

Refuse to budge with the builder and see what happens. If they don't reduce then be prepared to walk away, but safe in the knowledge that you didn't overpay for something. Remember, you are in a solid position as an FTB with a good deposit - your builder really should be biting your arms off.

I appreciate you saying that the flat has an outstanding finish, but in terms of valuation of new builds that doesn't really matter.

LeserattePD wrote: »

I also don't mind if the houseprices fall another 10% or 20% in the next two years.

You would if you needed to move in 12 months time due to job or family, and left with a flat which would be impossible to sell in that environment.

brit1234

LeserattePD wrote: »

I have to say that I'm starting to feel a bit harrassed here. All I did was ask for very specific advice. About the only helpful answers were Cannon Fodder and Trollfever. Nearly everyone else is happily riding their hobby horse and lording it over the poor stupid wrench who doesn't know what she's doing.

Sorry if we are upsetting you but our intention is to get you and others a better deal saving money. The name of this forum after all is moneysavingexpert.com not payovertheodds.com.

If you want to fiancialy self harm then fine, all we are trying to do is help you not do this.

Dan_1976

I think you are on a road to nowhere, however!

To appeal you need to show properties of that type that have sold for that price or more, not that are on the market. You will need 3, they need to be in the area, or an area of the same type and the properties must have sold for that price.

The property you use to apeal must have SOLD for that price or more.

I would question the agent/builder and if you really want to buy an overpriced new build flat, ask them to lower the price.

If the other buyer has a huge deposit the valuer may not have worried, they are not looking at if you have a good deal for you, but the risk for the lender.

AMILLIONDOLLARS

Believe me when I tell you, that you are going to find it virtually impossible to get the building society to change its mind on valuation. My daugther had a similar problem a couple of months back and we produced comparables upon comparables and so did the building society. We got the housing association to lower the price by £15K and made up the small difference in the end. If you really want the flat get the builders to pay for a new valuation, but bear in mind that it could come in even lower, especially as there is now talk that property prices will be falling in 2010. Unfortunately you are buying a new build, banks are now not willing to pay over the odds for them.

Good luck, you'll be needing it.

AMD

luckyfool

Who is your current lender? A different surveyor can come up with a different valuation figure depending on the lender he is valuing for as they set the criteria or basis on which it is surveyed. e.g. Nationwide in particular require the valuer to value based on its 2nd hand value, and they assume something is wrong with the survey if it is within 10% of the purchase price on new builds.

Going to Halifax or C&G could well solve your problem.

Jonbvn

We are FTB with a 25% deposit and have an agreement in principle for a mortgage from NatWest.

luckyfool wrote: »

Who is your current lender?

Your username seems appropriate;);)

LeserattePD

Dan_1976 wrote: »

I think you are on a road to nowhere, however!

To appeal you need to show properties of that type that have sold for that price or more, not that are on the market. You will need 3, they need to be in the area, or an area of the same type and the properties must have sold for that price.

The property you use to apeal must have SOLD for that price or more.

I would question the agent/builder and if you really want to buy an overpriced new build flat, ask them to lower the price.

If the other buyer has a huge deposit the valuer may not have worried, they are not looking at if you have a good deal for you, but the risk for the lender.

I got a whole list of similar properties that have sold around that price and higher. At the moment we're just waiting for the bank to ask the surveyor to actually provide a list of the comparables he used.