I'm freaking out!!!! Valuation / Survey

badger8

Good Morning My Money Saving Friends,

After years of saving for a mortgage we've finally done it :T
We've spent months looking for a property that feels like home and we've found it. Anyway, we've got the mortgage agreed in principle depending on valuation / survey. The property was in the market for £178500 but after some serious bartering we've got it for £160000. I'm not worried about the valuation, but I'm scared about the survey. The house is fairly new, at a guess late 80's to mid 90's. New gutters, doubleglazed and everything seems ok. My question is, do a lot of surveys come back and ruin mortgages? Or do you think I'm worring about nothing?

kingstreet

It's the valuer's report which influences the mortgage, not the survey. The survey won't even be seen by the lender. It's sent straight to you by the surveyor.

I'd be surprised at a negative valuation on such a young property. Provided the purchase price is reasonable for the area and the current market conditions which prevail there, you should be fine.

Once you have the valuation and the survey, you look at them and you decide if you wish to proceed with the purchase, wish to renegotiate the purchase price, or wish to pull out.

The information you are obtaining is designed to tell you if there's anything wrong that you need to know about. You could save thousands on the information in the reports so you should view them dispassionately, not as many do, a necessary evil which might prevent you getting the home of your choice.

GAH

IF the property is falling down or has serious structual defects it could be unmortgageable.

If it is unliable inside, Ie no kitchen, bathroom etc, then the lender can place a rentention on the mortgage.

If none of the above it should be ok.

Are you having your own survey, Homebuyers or Building survey done, in addition to the Lenders Valuation?

As this will point out any works that need carrying out.

propertyman

badger8 wrote: »

Or do you think I'm worring about nothing?

Yes!!!!!!!! it's called borrowing trouble.:)

The survey will tell you "what is", and if problems present decide whether you can tackle them, can afford them, and can adjust the price accordingly.

If it doesn't work you move on, worrying about what might happen won't change a thing, except a miserable time for you both.

You find the house now you let someone tell you what shape it is in, and in due course someone tells you that the legal side passes muster.

You just keep an eye on the market should it go wrong.

badger8

GAH wrote: »

IF the property is falling down or has serious structual defects it could be unmortgageable.

If it is unliable inside, Ie no kitchen, bathroom etc, then the lender can place a rentention on the mortgage.

If none of the above it should be ok.

Are you having your own survey, Homebuyers or Building survey done, in addition to the Lenders Valuation?

As this will point out any works that need carrying out.

Hi Guys,

Thank you soo much for the info. The only valuation in the one the lenders are providing us "free of charge".

kingstreet

So the lender's mortgage report & valuation, which is carried out for the lender's benefit is free. You are commissioning an independent survey. What kind?

adindas

Just want to know from expereince person ...

What happen if say that based on building surveying there is serious problem that need to be fixed. Let say the worst case structural problem, leak, need to chnage the scrap the hot water systems, systems, etc

etc .... I believe this will not be the case in the current propoert as the property is relatively new but I ma just mentioning the worst case ....

Could the buyer renegotiate on the basis of this surveys.
In case no renegotiation, could thus undervalue the property that will make the lender to think the value of property is not right which will make them reconsider lending the money ?

kingstreet wrote: »

It's the valuer's report which influences the mortgage, not the survey. The survey won't even be seen by the lender. It's sent straight to you by the surveyor.

I'd be surprised at a negative valuation on such a young property. Provided the purchase price is reasonable for the area and the current market conditions which prevail there, you should be fine.

Once you have the valuation and the survey, you look at them and you decide if you wish to proceed with the purchase, wish to renegotiate the purchase price, or wish to pull out.

The information you are obtaining is designed to tell you if there's anything wrong that you need to know about. You could save thousands on the information in the reports so you should view them dispassionately, not as many do, a necessary evil which might prevent you getting the home of your choice.

GAH

Obviously this is your own personal preference, but so you are aware the surveyor will be going in to make sure the property is mortgagable for the price agreed.

You move in and then find the roof needs to be replaced for the cost of £thousands in a years time, you may be kicking yourself you didn't pay out a bit of money for a survey.

Of course, you may have already factored this into your price you paying, in which case all is fine.

kingstreet

adindas wrote: »

Could the buyer renegotiate on the basis of this surveys.

In case no renegotiation, could thus undervalue the property that will make the lender to think the value of property is not right which will make them reconsider lending the money ?

It is usual for the buyer to try to renegotiate the price of the property or to have work carried out by the vendor to satisfy a survey, when their survey suggests a defect exists which affects the value of the property.

If the lender's mortgage report and valuation shows such a defect, the property can be downvalued and/or a retention set which means some of the mortgage funds will not be released until after the necessary repairs have been completed and the property reinspected by the surveyor.

In such circumstances, the buyer would need to increase their deposit to make up the shortfall caused by the retention.

G_M

You do not appear to understand the difference between the mortgage 'valuation', which is 'free', but is for the benefit of your mortgage lender, and a survey, which you pay for, and which is for you.

The Valuation is purely to re-assure your lender that if you fail to pay your mortgage, they can re-possess the property, and sell it for enough to get back what they lent you. They do not care what condition it is in (they will never live in it!) so long as the condition does not reduce the value below the amount they need.

You, on the other hand, want a place that you can live in. No leaking roof, no draghty windows, no expensive cracks, broken boiler etc etc to deal wih in the next few years. THAT is what a survey will tell you.

From the description you have given, th property will probobly be fine. The Valuation of course, depends a lot on what other similar properties are selling for. If you are paying more than others locally, it may be down-valued and your morgage offer reduced. But if you've agreed a fair price, the chances are you have nothing to worry about.

Similaly, on a property that age I'd expect the initial teething issues to have been sorted, and the old-age-related issues to not yet be present. But any property can have a hidden or semi-hidden problem which a survey should point oit. So it depends how risk-averse you are.

If you do decide to have a survey, and it finds a (potentially expensive) problem, you can then decide whether to renegotiate the price, or save yourself future expense by pulling out.

pinkteapot

badger8 wrote: »

Hi Guys,

Thank you soo much for the info. The only valuation in the one the lenders are providing us "free of charge".

So, you're buying the house without having a survey done?

Please consider getting a Homebuyer's Report done. It's the most expensive purchase you'll ever make and you don't think it's worth spending a few hundred quid getting an expert to check it over?

Some of my friends thought surveys were a waste of money. They'd looked at the house and it "looked fine". They moved in and the roof was leaking. :eek: