House valued in mortgage valuation for £65k less than offer!

britgirl82

Was wondering if anyone could shed any light on this.

We've just put in an offer (which was accepted) for a 4 bed house in London.

We've heard back from our potential mortgage provider and apparently their valuation has put the property as being worth a £65k less than the agreed purchase price.

The property is in London in an area filled with commuters into the City, and is in no way overpriced compared to the other properties in the area - a quick internet search will show you that a similar property (I'm not going to describe it but trust me on this..) is worth more than that - when we were looking we could hardly find 2/3 bed flats for that amount (and yes, I appreciate that what the surveyor considers to be the market value is not the same as price at which properties are put on the market)!

The area has not been declining in value, and I can quite easily find numerous example of similar properties on the market/which have sold for around the amount we are paying.

The valuation is ridiculously low, even if the lender is being conservative, and yes, I appreciate it's the surveyor's personal opinion and decor etc means nothing to them. I also appreciate that we really like the house and are therefore willing to pay for it, but such a low price is laughable as anyone who knows anything about property in London will agree. I'm tempted to call the vendor and ask if the valuer even bothered to open the front door to be honest since I can't honestly believe they have.

We have commissioned an independent survey and are awaiting their valuation.

Where do we stand? Will the lender take any notice of the independent survey assuming it comes back with a more reasonable opinion? Or do we need to approach another lender?

Thanks

LandyAndy

Can't comment until you get the result of your survey. Let us know what they say.

lottie176

As I understood it the mortgage lenders will only take their own valuation in to account and this is why you have to have a survey done by them as well as one you may do yourself. It does seem very odd though that they have valued it so low compared to other valuations made by EA's and other houses. The problem is that mortage lenders will not want to lend on something that they do not deem to be worth the money they are lending. If everything went to pot and the house was reposessed they would want to make sure they got their money back from that sale so need to know property is worth enough.
You may end up having to go with another lender and this will mean having to pay out another fee for valuation mortgage!!

lottie176

Oops, I meant to say you may end up having to pay for a new mortgage lenders valuation survey not mortgage!!

Fire_Fox

Are you looking at land registry sold prices or for sale prices?

silvercar

Why hasn't the estate agent provided the valuer with comparables? That's what usually happens when a valuer doesn't know the area.

kmmr

Maybe the surveyor did know the area. There seen to be a lot of threads here about low valuations from surveyors. Presume they are covering their rrrr's with the banks!

I got them to value on a further loan (equity release type thing) and get the survey redone by preparing a very polite letter with a number of recent comparables for sale, as well as one that was sold recently that was almost identical. They valued my place at £230k less than the recent sale... but still enough for me, so I moved on.

Very annoying though!

timmyt

you need another lender. Use a broker asap, but yes, more new lender fees.