new mortgage deal - any advice apprdciated

westy_1981

Hi, we are approx 18 months into our 2 year mortgage deal. We bought our place for £190k but market value is approx £215 to 220k. (Houses same size and standard in street gone for 215+ in last 6 months). Original mortgage was 85:15 LTV, question i have is if lender values place at approx 215k, what benefit, if any, does the 25k additional equity gain us when it's time to get a new mortgage deal, or is it just profit when / if we sell?

Hope this makes sense and thanks in advance

kingstreet

If the loan to value is lower at remortgage time, you'll get a better product. Be careful of customer retention products with your own lender. They may only use an indexed valuation and your property may be worth more on inspection.

dimbo61

Now if your property is worth £215K and your outstanding mortgage is £160K or lower you may have a LTV of 75% when you come to remortgage.
The only problem would be How many sales have happened on your road over the last 12/18 months ?
If lots and the prices have been £205/210/215K well your home might well be valued at £215K but if only 2/3 sales in last 18/24 months then the price you paid would come into the valuation!!!!
Now unless you have built a big extension I do not think you have added £25K in value
But I could well be wrong as we have no idea about the local housing market ( London)

kingstreet

dimbo61 wrote: »

The only problem would be How many sales have happened on your road over the last 12/18 months ?

FWIW Nationwide's criteria for comparables is 0.5m and 120 days.

westy_1981

If lots and the prices have been £205/210/215K well your home might well be valued at £215K but if only 2/3 sales in last 18/24 months then the price you paid would come into the valuation!!!!
Now unless you have built a big extension I do not think you have added £25K in value

Thank you everyone for their replies.


My thoughts about adding £25k are because we paid roughly that under the asking price - this was due to the owners being relocated with work, the company they worked for buying the house from them to enable them to move chain free and then the company being desperate to sell it, hence we got £30k knocked off the asking price.
May be hoping, but ideally we'll be able to get a 75:25 deal or better. Again, I may be wrong so any advice would be great . . . .