Natwest Mortgage Undervalue £30k!!

cyberion

Hi, We are first time buyers, buying a new home which wont be completed until July.

The asking price is £205000. All was going well, until Natwest did a survey and undervalued the house by £30,000, so they wont give us the mortgage.

This site has 50+ houses, all of which have sold for the asking price of £205k, some of these have been mortgaged by Natwest.

How is it possible for this to be so far out of sync with the rest of the other houses?

We have appealed, should i be worried? is this such a massive difference that actually it was a mistake made by the survey company?

Any advice welcome!!

Bullfighter

Sadly I fear that you are stuck. You might want to talk with some of the other buyers, they may be in the same position. You could all then approach the developer and negotiate a lower price or a bridging loan from them.

franklee

How do you know for sure what the others sold for? I hope you're not taking the builder's word for it or just looking at asking prices. Have you checked personally with those who've moved in? Land registry gives an idea but that lags and may not show up all the incentives.

Also what size deposit do you have? I'd expect any lender would be more cautious if there is a smaller deposit as their own money becomes at risk quicker when prices fall.

Have you shown the survey to the builder, what do they say?

Milliewilly

My Sis had this problem last year with NatWest. She got a second opinion and NatWest did agree to up the value but she had about 80% deposit.

Wickedkitten

Yes by all means, talk the mortgage company into actually making you pay more than they think the property is worth, no wait, the other thing, If the builder isn't prepared to lower the price, then walk away.

You wouldn't go to a supermarket and pay over the odds for your shopping would you?

ILW

They are basing on resale value if they need to reposses. All new builds drop as soon as they cease to be new.

bryanb

cyberion wrote: »

This site has 50+ houses, all of which have sold for the asking price of £205k, some of these have been mortgaged by Natwest.

How is it possible for this to be so far out of sync with the rest of the other houses?

The selling prices are irrelevant, it's the amount of the loan you are questioning.

Bullfighter

I'm assuming you have already paid a substantial deposit, is this right?

If not, walk away in the knowledge that you have just avoided £30k negative equity bull-trap.

bristol_pilot

A small undervalue by the mortgage company is normal, especially on a new build. But £30k on a £205k house is a lot. I would be concerned that you really are paying too much for the property and should pull out of the deal unless you can negotiate a reduction of £25k or so.

ghostbusters

hope I am not being offensive but I still find it surprising ( after the events of the last few years) that people seem to blame the banks in such situations as opposed to thinking perhaps this is a reality check..
I would think a lower than expected evaluation by the bank strengthens the negotiation position of the buyer..

puddy

also, even IF they all sold for 205k which i would find surprising, it doesnt mean that the valuations were more than yours, it simply means that the buyers were willing to put up more deposit than you