Mortgage Survey - retention imposed. I need some advice/perspective pls!!

Rickb

Hi,

So we have a property that we have had an offer accepted on (below asking) which is dated from around 1900. Visually it looked in good condition with modernisation required.

Mortgage company completed a survey and have imposed a £10k retention on our mortgage with the following points:

1. Instruct specialist contractor to inspect and test the drains system. Carry out necessary repairs.

2. There is evidence of beetle infestation, damp, and timber decay, including damp to upper parts of walls and chimney breasts. Obtain specialist advice from a PCA registered contractor and carry out recommended repairs.

3. Carry out repair to split timber purlin to front right roof void.

4. Overhaul chimneys, flashings, roof coverings and valleys.

I've not yet been in receipt of the homebuyer report portion of the survey to know the extent of the above but I'm panicking and need some advice/perspective.

On a property of this age, are the above comments relatively standard?

Do the above points seem expensive to rectify/comply with?

Is it normal to go back to their estate agents and try and negotiate more money off the property in light of new works?

I've only just got the email so still trying to digest it and not looked at any costs etc only. Just looking for some advice from experience on here.....thanks in advance...

Rick

Werdnal

Yes, retentions on older properties are not unusual. We had one on our home when we bought back in '93. We only wanted to borrow £30K, but they kept £5K back requesting certain works. We had a timescale to complete it and draw down the money, but in the end, we beg, stole and borrowed enough that we didn't need the extra £5K, so actually reduced our mortgage anyway.

The things mentioned sound like they need to be addressed BUT you can go back and present the report to the vendor and see if they will take a reduced offer - after all, unless they get cash buyers, any future survey from someone else will likely pick up the same things!

Rickb

Thanks Werdnal, that is reassuring.

I think we can allocate enough of our budget to cover the shortfall they are retaining, but it's knocked the wind out of our sails a little. I'm going to wait for our homebuyer report for some more details and then ask our agent to contact theirs and outline what was found and try and get a further reduction.

It just keeps eating into our renovation budget....

Anyone else have experience at this - did you get money off the asking price based on the survey??

Werdnal

Going back to our house, it was on market for £59,950. Our original accepted offer was £55K.

After the survey, which was as thick as a telephone book, we went back and re-negotiated down to £45K. I'm talking '93 here, 20 years ago before all the boom and bust times, but the survey is your bargaining tool - otherwise what is the point in having it done in the first place?

The vendor's solicitor tried to argue that if we carried out all the highlighted works, we would no longer have the quaint cottage we had bought, and some of the things in the survey were "character" and expected in a house in excess of 200 years old. In fact that the vendors hadn't spent a penny on the place since they moved in 47 years previously ... we wanted a renovation project, but the morning we got the keys we had an architect meet us to advise on the work, and he asked "when was it last lived in" ... vendors had only moved out the day before. I am sure yours is not this bad, but there must be room for negotiation - if they are retaining £10K, I would be expecting atleast £5K reduction, but start higher and work down to get what you want.

We were also helped by the fact that vendors were in their 70's, looking to downsize (already made an offer on a smaller place) and 2 previous sales had fallen through as survey had led to buyers walking away ... depends whether the vendors you are dealing with are receptive to an offer or determined to hold out for top dollar!

kingstreet

You need to get reports and estimates from the suggested specialists before you do anything else. A chartered surveyor will provide only a suggested estimate of the costs and this may vary widely from the reality of what's needed.

Don't go renegotiating now, then have to go back again later if the bill ends up more.

Conversely, the surveyor may have over-estimated or assumed work which proves unnecessary and he will reflect that in the final retention, if one is needed at all, once he's seen the detail of the reports and estimates.

Finally, get an independent timber & damp surveyor, not a firm with an interest in doing the work. It may cost you £200, but it could save you thousands in unnecessary damp work because your independent finds a leaky gutter or soil level bridging the damp course;-

http://www.independentdampsurveyors.co.uk/

Rickb

Thanks again Werdnal and thanks Kingstreet.

I will get the reports conducted once I get the homsbuyer report with the full suggestions - I'm annoyed that it isn't with me yet given the lender has info already.

Do I need to contact anyone - solicitors, Estate agents to let them know the process is on hold till I get further reports?

Presumably I will need to let their Estate Agents know since any specialists will need access.

I guess I might get a feel for their willingness to negotiate when we tell them further surveys are needed.

I've been having the agent that sold our property negotiate on the prices so far - should I continue to use them or do we think they might get annoyed with keep speaking with this other agent??

To elaborate a little more, we opened the offers at £370k and reached agreement at £380k. The valuation came in at £370k with the £10k held back.

Cheers

Rick

Rickb

kingstreet wrote: »

You need to get reports and estimates from the suggested specialists before you do anything else. A chartered surveyor will provide only a suggested estimate of the costs and this may vary widely from the reality of what's needed.

Don't go renegotiating now, then have to go back again later if the bill ends up more.

Conversely, the surveyor may have over-estimated or assumed work which proves unnecessary and he will reflect that in the final retention, if one is needed at all, once he's seen the detail of the reports and estimates.

Finally, get an independent timber & damp surveyor, not a firm with an interest in doing the work. It may cost you £200, but it could save you thousands in unnecessary damp work because your independent finds a leaky gutter or soil level bridging the damp course;-

http://www.independentdampsurveyors.co.uk/

Hi Kingstreet,

I'll look at getting an independent surveyor to look at the property once I have the report. If his analysis comes back that the mortgage lender's surveyor misdiagnosed the issues, is it possible to get that opinion overridden or would the lender insist on the work being done anyway?

thanks

Rick