Remortgage valuation

remortgagehelp

Good afternoon, I am looking for a bit of advice on assessing a properties value and dealing with a 'down' valuation.

I have recently applied for a remortgage with the Chelsea BS, a valuation was carried out by Countrywide Surveyors. We were unsure of our property valuation and took the advice of an estate agent that it was worth £230,000.

We bought the property just under 2 years ago as first time buyers. At the time we believed we picked up a bargin and still do now. The owner was moving abroad and had just had a sale fall through, she needed completion within 2 months. We were able to buy the property slightly below the market price in the area. This was £215,000. Prices round here have remained the same if not risen slightly in this time.

No other houses of this size of the decade ours was built have sold recently. This is a 1975 house, we found a size comparable but it was built in 1999 so we were advised this is not a comparable. We live in a village.

The valuer valued it at the price we bought it. To be honest we knew a valuation of £230,00 was unlikely but we were convinced the lowest figure would be £220,000 and we could find the money to allow us to apply for a 70% mortgage based on this.

The valuation came back as £215,00 and without going to family we can't make up the difference. As mentioend above the comparables we sent were not suitable.

In the mean time whilst discussions were going on a comparable property came under offer, just a few doors up the road. This sold for £223,000, our proerty has a bigger plot and a second garage so we feel this would be a fair valuation with no risk to anyone. The sale should go through any day and we are in a position to wait for it but no one will even consider it.

I have registed a complaint with the chelsea as this is one of many issues but is the biggest sticking point. However they don't seem to want to address any of my questions about our application and in particular why they will not look at this recent comparable.

I phoned the ombudsmen for advice, they told me a valuation is not a purchase price and I shouldn't expect to have a remortgage valued as a purchase would be. I simply do not understand this surely the price should be the same remortgage or purchase?

Is there anything else we can do? Am I trying to fight something unfightable?
Thank you.

Thrugelmir

Is your mortgage interest only?

betmunch

Surely your complaint should be addressed to the Surveyors if you believe their valuation to be incorrect. Chelsea are only working with what they are being told by the surveyors.

Who exactly have you complained to?

holly_hobby

The "valuation" given by an estate agent is for marketing purposes only, and is really only a general sale price guide, which they believe in they MAY achieve on the open market. They are (generally) neither qualified surveyors, nor really in a position to give advice as such.

The "valuation" provided by a surveyor, is on behalf of the lender, and is the surveyors considered opinion of the property value as security to the lender. They will consider compariblies, the local area, demand, the LTV etc in performing their assessment. The value they give will be what they considerd to be reasonable to sell the property in a relatively short time period, should the lender be forced into a possession order and reposess the property for sale. You have to remember they are acting in the lenders best interests, not necessarily yours. (although I am sure you would not want to obtain a mge on an inflated value, which would effectively leave you in neq equity either !)


So thats why there can be huge differences between the 2.

He has come up with the orig purchase price, as there were no other compariblies - the one you say has come up recently Chelsea don't wish their surveyor to consider, and it would have to be the sale price anyway, obtained from public domain LR records of sale.

There is really little you can complain about, as the lender reseves the right to accept yourself and property as mortgagors or not. They have offered to do so based on a prop value of 215k - unless you can get on to the surveyor directly with your added info, and get them to reconsider and represent this to the underwriters - you are a bit stuck I am afraid.

Indeed, even if you had a private survey done with a panel surveyor (which values up), Chelsea still do not have to accept it, the choice is theirs I am afraid.

If it helps, I had this issue with my own property remortgage (Halifax whom have always been notorious downvaluers). Knowing this, I duly obtained recent sold comparibles and contacted the surveyor directly, he was happy to reconsider based on the info I had provided, and duly amended his valuation (which was lucky I grant you !).

But this does not always happen if the surveyor believes his initial guide to be realistic and appropriate (indeed I have had many clients when I was an adviser and as a packager, whom were not so beneficial and had to cut their cloth accordingly, or took a chance with another lender whom used a different surveyor group - but its risky as there is nothing to say that survey wont come back the same or even less than the first !!).

Hope this helps

Holly

somethingcorporate

I'd be surprised if they revalued it at a higher amount than you paid given property prices have continued to slide.

Whilst the sale may be going through "any day now" what evidence do you have it is at £223k? It won't appear on the land registry for a number of months so cannot rely on this.

opinions4u

I spent far too many years talking to customers about their property.

Everybody's house was better than the one that had just sold for £xxx,000 round the corner.

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The market is poor nationally. While there may be pockets of modest price inflation on the whole a small reduction in value is not unexpected.