Mortgage valuation issues

upsizer

We had a mortgage valuation and homebuyer report carried out on the hjouse we are planning to buy.

I caled the bank today for feedback and they said that the report has valued the house at 3k less than the agreed sale price AND the valuer has requested a full structural survey plus a damp and timber report. She then said something about a suggested 10k retention, but then went on to say that this particular bank don't do retentions (?!?).

I have ordered a building survey to take place and contacted the EA to warn them about the lower valuation. Basically we're now waiting to find out the outcome of the building survey to see if we have any chance of borrowing the amount we need.

The issue with the structure seems to relate to some movement and minor cracks in one of the walls attached to an outbuilding. It seems that if the movement has ceased, then the lending could go ahead, if not then goodness knows.

I'm a bit befuzzled by the whole thing. The house is perfect for us and came up just as we sold our own property. There's nothing else around right now that we want to buy, so if this doesn't work, we'll have to go into rented which won't be ideal.

I don't have a specific question here, was just wanting to get it all out!

ACG

Would you want to buy it if it were falling down?
If not, then you should be happy they have picked up on it.

holly_hobby

If there are current movement issues, take my word for it, you want to know about it now before you buy it.

If there is current/on going movement detected, which may affect the structure of the bldg (which at the moment is unknown and why the valuer has requested a Structual Engineers (SE) report), the SE will normally recommend having the structure underpinned.

If thats the case, firstly this is for the Vendor to deal with and I wouldn't even consider proceeding until the works are done (as I would anticipate a full retention for movement in any event), and secondly you need to consider how this may affect your future application for blds insurance (and indeed future resale), and thats of course with the Vendor providing you with full insurance backed gtes for the work. As in many cases this will be an issue for insurers, and, if you proceed, your only available blds ins option may be the current insurer of the Vendor (assuming they agree to re-insure to you as the new owner of course).

My heartfelt advice, is to wait and see what the SE report comes back with before electing whether there may be something better for you elsewhere - if the SE report comes back full of woe, IMHO you've been saved a whole load of heartache and personally I would look for an alternative.

The upside is of course, that the movement is deemed as being historical or minor - which means that you may wish to re-negotiate to pch at the valuation fig, have them do the work, accept the downvalue and pay an increased deposit - if the the Vendor refuses to reduce any further OR of course pull out altogether.

Hope this helps ... pop back when you have the SE results in

Holly

upsizer

Thanks for your replies.

I'd already ensured that we were getting the right kind of report done, so that's all ok.

I have received the valuation report in the post today and this is what it says:

Matters to be dealt with by customer - Essentail Repairs and Special Comments

1. Instruct a Structural Engineer or Chartered Building surveyor to inspect the property and report on evidence of past movement to the house and the relatively minor cracking that has now occurred as well as the significant disturbance to the attached outbuilding that requires to be removed, repaired or rebuilt in accordance with the engineer's recommendations, along with repair to the adjacent and other damaged boundary brick walls.
2. Implement the recommendations of damp and timber specialists reports which should encompass inspection of all including sub floor timbers.

General Observations

An end terraced ouse occupying a moderately sloping site inthis well regarded established residential locality convenient for local amenities. The property was fairly well presented for its type and age although in need of some maintenance and cosmetic attention. In addition there was evidence of some past movement to the house which appears substantially longstanding although several thin cracks are now visible. Whereas the attached outhouse has the far rear section removed the remaining building is in poor condition with significant cracking to it and its boundary walls.

We have enlisted a surveyor to carry out a full structural report in the next few days and I'm now trying to find damp and timber specialists.

Oh, the joys....

holly_hobby

I know .... can be a pain.

Your D&T report (look in yellow pages for local firms whom give free quotes/estimates, just as a guide, Peter Cox is a pretty well know specalist, and being going for many yrs, and a firm whom I used for such reports in my own placement days). Hopefully, their findings (or whomever you instruct) won't be horrendous ... condensation can often be mistaken for damp by surveyors (and its not too serious, more a case of poor ventallation than anything more sinister, but even a failing damp course can be remedied fairly easily). But as its not the surveyors area of expertise, they are duty bound to request an experts report - and it is common, so don't be too worried that the request of such reports is highly unusual - its not honestly.

Your SE will want a copy of the survey (which I presume you've already provided tg them with) - its sounds as though the surveyor is worried that if the OH goes, the possible distrubance to the ground, may well cause some more shifting in the main structure itself - which is why he is suggesting the demolition of the OH itself.

Keep us updated...

Hope this helps

Holly x

upsizer

Holly, thank you, that does help.

The bank have said that the only reason they wouldn't lend is if there is evidence that the movement is ongoing. If not, then I suspect they will require us to get the repair work done on some basis or other.

I have sent a copy of the report to the building surveyor and so he knows what he's looking at.

I will indeed kep you updated!

upsizer

Sorry meant to add that I contacted Peter Cox and will use them I think

holly_hobby

Hi US,

If the movement is historical, then thats it, the cracks are more the issue of a little filling and paint than anything else (and remember that all houses move, slightly, over their lifetime, its only an issue if the movement is a threat to the stucture and integrity of the property).

I must also add that I don't work for P Cox, nor do I endorse them - but I have used them professionally for many clients in the past, which is what my comment was based on. (just to cover myself and any forum rules !).

Hope all goes ok ... pop back when the scores are in !!

Holly x

bigadaj

Just a bit concerned about appointing a surveyor to do a structural report, make sure this is done by a structural engineer and not a surveyor as the surveyor won't have specific expertise.

holly_hobby

A std surveyor is unable to take a SR instruction thats why they request a report from a SE - so I wouldn't worry too much B. - OP will be referring to a SE when they say "building surveyor" , my guess is that it was just a little lost in translation, but good point to raise.

Hope this helps

Holly

upsizer

Thanks again for your replies and advice.

Holly, don't worry, I'd already been given the name oorf Peter Cox by the surveyor!

It is actually a chartered building surveryor who is doing the survey - in the comments on the mortgage valuation (posted above), it says to get either a structural engineer or a chartered building surveyor.