Opinions please!

edthedead

Long story fairly short (names omitted and figures changed but percentages are correct)!

We have a mortgage with a certain bank or building society and have done for around 10 years. We moved house in 2010 and 'ported' the mortgage to the new property, we also borrowed a bit extra to do some building works. We paid £260,000 for the new house, 98,000 from the old mortage and borrowed 5,000 extra. We then borrowed a bit more in 2012 but kept the LTV under 50%.

The house is now worth £310,000 (very confident this is correct based on extensive research and recent sales of houses in the road).

Now the problem!!

I want to move the 2 additional borrowings onto a new fixed rate (currently on the banks standard mortgage rate) but the bank are saying that the house is now worth only £185,000... so the LTV is around 70% where as it should be under 50%.

Checking back on the paperwork it seems that in both 2010 when we did the extra borrowing (1 months after we purchased for £260,000) they valued the house at £175,000 and then again in 2012 they valued it the same. These values are completely incorrect and I have no idea how they arrived at them.

They are now basing their current valuation on the 2012 valuation and refusing to re-value, or even entertain the fact that they might be wrong.

They are saying that since the values were on both agreements for the extra borrowing I should have spotted it and appealed within 3 months. Fair enough, it was on the agreements but it was never pointed out to me by their advisor (sales person), had it of been I would have appealled! Seeing as it was partly my fault I had no issue with the fact that I could have got a lower rate on the additional borrowing for the last few years, I just want them to correct the issue now.

Am I being unreasonable? Anyone got any idea if I stand a chance wiht the ombudsman?

HTB_newbie

Could you not remortgage with a different lender and get a current valuation or are there still too many ERC to make this feasible?

Thrugelmir

edthedead wrote: »

Am I being unreasonable? Anyone got any idea if I stand a chance wiht the ombudsman?

The lender is under no obligation to offer you a new product.

Care to name them?

edthedead

I don't think it would be a good idea to name them at the moment.

I could re-mortgage with another lender, but our situation is a bit unusual, 4 names on the mortgage and part interest only... it would be easier to stick with the current lender.

I appreciate that they don't have to offer a different product, just feel that they are being extremely unfair with their current position which is basically "computer says no... "!

chambta

I can't see why they won't allow you to pay for a new valuation to see where it now falls LTV-wise.

Have you offered to do this?

edthedead

chambta wrote: »

I can't see why they won't allow you to pay for a new valuation to see where it now falls LTV-wise.

Have you offered to do this?

Its an option, done a bit of googling but can't find how much it is likely to cost for a valuation. Any idea?

Dave_Ham

You were very confident of the valuation previously, so how is this only an option; this should be your plan A

Typically a revaluation will be £150-£300, although wholly dependent upon the lender in question.

You are likely to want to stick with this as a part and part with 4 persons will be tricky to remortgage, tricky not impossible but dependent upon specifics.

Goldiegirl

Do you happen to know what they valued the property at when you had the original advance?

Also, when you had the additional lending, did they actually send out a valuer to the property?

I'm thinking that they are basing their current valuation on the original valuation that was done when you bought the house. It seems the valuer thought the property was worth a lot less than you paid, but as you had a low LTV mortgage, this didn't affect the amount you wanted to borrow

edthedead

I am very very confident of my valuation, but not really sure why I should be stuck paying for a re-valuation to sort out a mistake which isn't really mine... although argueably I should have spotted it earlier.

When we had the original advance in 2010 they valued it at £175,000 exactly the same as in 2012, both of which were very wrong! According to the lender the valuation done in 2012 (which they won't supply to me) was a 'drive by'...

Goldiegirl

It's not a mistake as such, it's the valuers opinion of the value of the property, and the fact that the lender doesn't seem to have a system where they have index linking on the valuations, to allow for changes in the value of the property.

In 2010, when the property was originally valued at £85000 less than the price you were purchasing it - did you query the valuers opinion at that time? However much I wanted to buy a house, a low valuation like that would make me think twice.

As it stands, your only real option is to ask them if they will revalue, and if they do instruct a valuer, accept the the valuers opinion may still be very different to your opinion of the value of the property

Dave_Ham

Personally, I would think you would be better off paying for it, validating your point and getting what you want asap.

You can then argue it out with the lender about getting this refunded, if you have been fundamentally disadvantaged.

I would suggest that the onus will lie with you checking the original documents in more detail, but you never know.