Retention on mortgage offer

bilb27_2

Hi guys,

Long story cut short but have had offer on house accepted and survey done. Surveyor suggested £10k retention and required further reports to be done. Have done this but the surveyor is being picky and wants stipulations on report of work that is not needed as well as does need doing.

I have agreed a price of £127,000 and his current value is £ 125,000. The works have been valued at £4200. Where do I stand with regard to the seller? Am i within my rights to renegotiate the price or demand he does the works?

Any help would be appreciated.

anselld

bilb27 wrote: »

Am i within my rights to renegotiate the price or demand he does the works?

You can try either, but the vendor is equally within their rights to refuse.

To be clear, is £125k the valuation prior to the £4.2k works or with the works complete?

bilb27_2

anselld wrote: »

You can try either, but the vendor is equally within their rights to refuse.

To be clear, is £125k the valuation prior to the £4.2k works or with the works complete?

Yes thats right. The retention is 10k and works are 4.2k.

anselld

bilb27 wrote: »

Yes thats right.

Which one, you haven't answered the question I asked?

To put it another way....
What is the surveyors valuation once the works are complete? Is it...
(a) £125k, or
(b) £125k + £4.2k = £129.2k, or
(c) £125k + £10k = £135k

So if the purchase price is £127k and the works cost £4.2k you will spend a total of £131.2k, so depending on the answer above ...
(a) You would be justified in asking vendor to drop by £6.2k
(b) You would be justified in asking vendor to drop by £2k
(c) You have got a bargain anyway, no justification for reduction.

bilb27_2

sorry for confusion.

Value in current condition is £125,000 as per survey. The surveyor has recommended a retention of £10,000 for our mortgage application. The works have been valued at £4200.

Hope this helps.

anselld

I would say fairly good case to ask the vendor for a reduction then. Probably ultimately settle for splitting the £4200 50:50.

bilb27_2

anselld wrote: »

I would say fairly good case to ask the vendor for a reduction then. Probably ultimately settle for splitting the £4200 50:50.

Thank you for your advice. That is what I was thinking of suggesting. Great Help

anselld

bilb27 wrote: »

Thank you for your advice. That is what I was thinking of suggesting. Great Help

Its still a negotiation though, so I would start by asking for the full £4200 even if you intend to compromise to the 50:50 split.