Mortgage Loan to Value question

GSXRCarlos

Hi,

I bought my house cheap nearly 3 years ago @ £85,000 and have fitted new bathroom, kitchen internal decor etc. Other properties in the area are worth approx £100,000 for a mid terrace, next to no garden and mine is end terrace with a garage

I want to up the property value on the mortgage from £85,000 to £100,000. I owe approx £70,000 which puts me give me a loan to value of less than 70%

I've spoken with my current lender and they will only up the property value by the value of the works (approx £10,000 = £95,000)

How can i get the property valued at the higher £100,000 figure and secure a mortgage against it?

The_J

Get a mortgage with another lender. They will value the property on it's current situation.

xyellowx

you cant they will only value your property based on surrounding like for like properties

holly_hobby

xyellowx wrote: »

you cant they will only value your property based on surrounding like for like properties

Indeed, the only way to break the ceiling would be if the property was finished to an exceptionally high standard setting it apart from the variables, and/or has extra rooms to those compared - such as provided by an extension. Resulting in it being set apart from the crowd, with accompanying high market demand and buyers willing to pay a premium for the high standard of specification and improvements.

Not too easy to break the local ceiling, but it isn't unknown.

Hope this helps

Holly

kingstreet

You could apply for a remortgage. Find a fee-free offer, so it costs you nothing if the surveyor carrying out the valuation doesn't agree with your estimated value.

Failing that, pick a lender with a product with a 75% limit and you've got a little to play around with.

What product did you have in mind with a 70% maximum LTV?

GSXRCarlos

xyellowx wrote: »

you cant they will only value your property based on surrounding like for like properties

Surrounding properties are upto £100,000 and mine has more space plus a garage, Nationwide have already said they won't re-value the property, only the current value plus the value of the works (£85,000 + £5000 for bathroom and £5000 for kitchen)

kingstreet wrote: »

You could apply for a remortgage. Find a fee-free offer, so it costs you nothing if the surveyor carrying out the valuation doesn't agree with your estimated value.

Failing that, pick a lender with a product with a 75% limit and you've got a little to play around with.

What product did you have in mind with a 70% maximum LTV?

Thanks King, my fixed rate is coming to an end and i'll be dropping onto Nationwide's SMR of 3.99% which is lower than i'm currently paying, but if i have a LTV ratio of 70% they're offering 3.79% fixed for 3 years - it's this i'm interested in, otherwise there's no point fixing and i might as well stay on their SMR

kingstreet

So you only get that rate if they agree the property is worth what you say it is, and they don't? So no 3.79% fixed for three years?

So your first option is to stay with Nationwide on 3.99% or your second is to move to another lender whose surveyor may feel the property is worth what you estimate it to be when he inspects it.

There's no fee-free three year fix at or under 3.79%, so what about a two year instead? RBS and NatWest have products at 3.79% fixed for two years fee-free and the maximum loan to value for these deals is 75%, so you won't need such a high valuation. For example, £70k on £95k is still under 75%.

Co-Op Bank has a slightly cheaper two year fix if you bank with them, also upto 75%.

I guess this all depends on how much you want another fix and how long you want it for. Incidentally, the five year fixes for Nationwide, NatWest and RBS are all 4.39% and the latter are fee-free when moving to them.

Your call though!

GSXRCarlos

kingstreet wrote: »

So you only get that rate if they agree the property is worth what you say it is, and they don't? So no 3.79% fixed for three years?

Correct

So your first option is to stay with Nationwide on 3.99% or your second is to move to another lender whose surveyor may feel the property is worth what you estimate it to be when he inspects it.

Correct

There's no fee-free three year fix at or under 3.79%, so what about a two year instead? RBS and NatWest have products at 3.79% fixed for two years fee-free and the maximum loan to value for these deals is 75%, so you won't need such a high valuation. For example, £70k on £95k is still under 75%.

Do i have to switch my main account to them? Will i be tied to their current account for the duration of the mortgage?

Co-Op Bank has a slightly cheaper two year fix if you bank with them, also upto 75%.

currently bank with santander, but might be moving in the next few months to a better interest deal

I guess this all depends on how much you want another fix and how long you want it for. Incidentally, the five year fixes for Nationwide, NatWest and RBS are all 4.39% and the latter are fee-free when moving to them.

Your call though!

Kingstreet, thanks for your help, i'm only looking for the lowest interest so that i can maximise any overpayments without early repayment charges. Nationwide were offering various cashback deals to swith to their new products - hence the desire to stay with them on their new fixed rate

JimmyTheWig

GSXRCarlos wrote: »

I bought my house cheap nearly 3 years ago
...
I've spoken with my current lender and they will only up the property value by the value of the works

Bizarre.
When I remortgaged my first flat after 3 months of moving in Abbey did a fresh valuation as it was more than 6 months since their first one.

Does anyone know if this is par-for-the-course with Nationwide, or if the OP would be able to get them to revalue if he asked the right person / question?


Carlos, do the Land Registry figures show increases in your area since your last valuation? If so, you might be able to use this to convince Nationwide to up their valuation / come and have a look?
I think that they will be unlikely to take into account your word that you bought it "cheap". Ultimately you bought it for the price the vendors could get for it. Which pretty much fixes its value at that point in time.

Thrugelmir

JimmyTheWig wrote: »

Does anyone know if this is par-for-the-course with Nationwide, or if the OP would be able to get them to revalue if he asked the right person / question?

Always request a formal valuation. This would cost money however. That may not be well spent.

holly_hobby

On a remortgage they can elect to do a desktop, drive by or attended val.

An attended val is usually reqd where there are no recent variables, on a challenged val by the individual (if so the individual will pay for an attended survey), or the property is unique or has been significantly improved (where the works are not apparant from street view), in essence anything that may set it aside and quantify the higher estimated value by the applicant, when compared to other suitable compariables available at the time.

Hope this helps

Holly