Devalued by survey - how much will the mortgage provider lend?

garmei

Hello. I could do with some opinions please...

I've agreed a purchase price of £238,000 with the vendor of a house. The mortgage provider has valued at 200,000. I have a 10% deposit to put down.

The mortgage company has been horrendous to deal with and I haven't been told how's much they are willing to loan me. would anyone be able to confirm or speculate whether they will lend me up to the £200k valuation amount or will they only lend me £180k (I.e. the valuation minus my 10% deposit). Or could it be somewhere between?

I know i must wait for their verdict, but thought others might have some experience they could offer as I'm also exploring the possibility of applying with another lender who may also devalue at the survey stage.

Many thanks for your time.

DannyboyMidlands

How would we know?

Among other things, it depends what product you have applied for.

If the max LTV is 90% then the max they will lend on this house is £180k.

I would attempt to renegotiate the price. The horrendous lender may have just saved you £38k.

titusbungle

garmei wrote: »

Hello. I could do with some opinions please...

I've agreed a purchase price of £238,000 with the vendor of a house. The mortgage provider has valued at 200,000. I have a 10% deposit to put down.

The mortgage company has been horrendous to deal with and I haven't been told how's much they are willing to loan me. would anyone be able to confirm or speculate whether they will lend me up to the £200k valuation amount or will they only lend me £180k (I.e. the valuation minus my 10% deposit). Or could it be somewhere between?

I know i must wait for their verdict, but thought others might have some experience they could offer as I'm also exploring the possibility of applying with another lender who may also devalue at the survey stage.

Many thanks for your time.

Unfortunately from what I understand they will lend you £180,000 as the property is valued at £200,000 and you have a 10% deposit. You need to contact the estate agent to try to renegotiate the price. Good luck!

garmei

DannyboyMidlands wrote: »

How would we know?

Among other things, it depends what product you have applied for.

If the max LTV is 90% then the max they will lend on this house is £180k.

I would attempt to renegotiate the price. The horrendous lender may have just saved you £38k.

Thanks for the reply.

They are horrendous to deal with in every conceivable aspect of customer service. They have not saved me £38k, they have simply stated what they think it is worth and unfortunately it is a lot less than I value it at. I have learnt a lot this week about the differences between a mortgage providers valuation survey and an indendant survey for a private individual.

Thanks for the definite answer though, at least I know where I stand.
Cheers

garmei

titusbungle wrote: »

Unfortunately from what I understand they will lend you £180,000 as the property is valued at £200,000 and you have a 10% deposit. You need to contact the estate agent to try to renegotiate the price. Good luck!

Many thanks. Unfortunately we have already negotiated from £250k and the seller won't move any where near 200k.

Cheers

mrginge

I take it you have the extra 38k then?

kingstreet

If you have selected a 90% product from the lender's product range, you will be able to borrow 90% of the lower of;-

- purchase price
or
- valuation.

The surveyor appointed by the lender will independently decide on the value of the property, basing his valuation on the "sold" prices of similar property sold in the last 120 days within 0.5 miles;-

http://www.rightmove.co.uk/house-prices.html

and you can do the same to establish if your agreed purchase price was out of kilter with the local market.

garmei

mrginge wrote: »

I take it you have the extra 38k then?

I could get it together, but I won't be paying more than what it is valued at by the mortgage provider, despite believing that it is worth a lot more than that.

Grrrr

Thanks

gazter

garmei wrote: »

I could get it together, but I won't be paying more than what it is valued at by the mortgage provider, despite believing that it is worth a lot more than that.

Grrrr

Thanks

The vendors house is going to sit on the market for some time. That is a big difference between their original £250,000 and the £200,000 from the surveyor. If you are really stuck on it and can get it together i would be going nowhere near the £238, but looking for maybe £210, thats much better than he is likely to get if all the valuations come back at £200.

witchy1066

kingstreet wrote: »

If you have selected a 90% product from the lender's product range, you will be able to borrow 90% of the lower of;-

- purchase price
or
- valuation.

The surveyor appointed by the lender will independently decide on the value of the property, basing his valuation on the "sold" prices of similar property sold in the last 120 days within 0.5 miles;-

http://www.rightmove.co.uk/house-prices.html

and you can do the same to establish if your agreed purchase price was out of kilter with the local market.

sorry to butt in and apologise to OP

but I would love to know how they come up with a house value if nothing in the area has sold since 2006

Jaybo10

We had exactly the same thing.

A property we liked went to sealed bids. We offered £425k and our offer was accepted. Mortgage valuation came back at £360k. Sadly we didn't have £65k knocking around (who does!?). We appealed and eventually the valuer revised his decision and it went up to £380k - still not enough for the seller so it went back on the market and was bought by a cash buyer for £425k.

We were gutted. The difficulty we had was that we were buying in a rising market (and rising rapidly - we saw prices rise by £50k in the 4-6 months) so there was not the sold price data to back up our offer. There is now