Changing mortgage deposit amount after offer

redonion

Since I got my mortgage offer I discovered more work on the building will need doing than I anticipated. That means I think I will need to hold on to more cash than I had planned in case it needs doing quickly.

My deposit was above the 25% level by about 10k. I want to take it down to the 25% level, which is about 50k.

Is that likely to cause a long delay for the lender (Santander for intermediaries) to reassess my case?

The property was valued at the selling price "for mortage purposes", though my own surveyor's report (which the lender has not seen) says that the price is too high and should be renegotiated (I say this as background re the mortgage offer rather than to ask whether I should renegotiate).

holly_hobby

You will need to advise the lender of the reduction in deposit, as this is what their offer will be based on, and your conveyencer complete the pch on.

If the property has been downvalued due to essential works, then yes go back and renegotiate - you should also be aware that the lender will base the mortgage assessment and offer on the LOWER of the pch price or valuation.

Hope this helps

Holly x

redonion

holly_hobby wrote: »

You will need to advise the lender of the reduction in deposit, as this is what their offer will be based on, and your conveyencer complete the pch on.

Sure. But my question was about how long it typically takes them to reassess a case in these circumstances (and I guess also how likely they are to pull out or unfavourably change terms as a result).

If the property has been downvalued due to essential works, then yes go back and renegotiate - you should also be aware that the lender will base the mortgage assessment and offer on the LOWER of the pch price or valuation.

Their (the lender's) valuation came in at the purchase price "for mortgage purposes". My valuation (homebuyer's report, different surveyor) came in some way below that.

Their offer was based on their valuation, not mine.

redonion

redonion wrote: »

Sure. But my question was about how long it typically takes them to reassess a case in these circumstances (and I guess also how likely they are to pull out or unfavourably change terms as a result).

Does anybody have any experience of this at all?

kingstreet

Loads of experience, but totally unable to tell you how long your amendment might take.

monty-doggy

I changed my deposit after negotiating after the survey, I reduced mortgage and so increased my deposit to loan ratio. It took a few days.

Why would you pay more than the house is worth? Surely you should negotiate the price, then change the mortgage? If the bank base it on the lower valuation you might get a better interest rate based on your LTV?

witchy1066

we have just had to do the same as OP after quotations came in for essential work higher than expected ,
it took our lenders a hour to ring back and say revised offer in the post to us and our solicitor, we are very close to exchange and completion

we went from 75% to 80% luckily for us the interest rate has stayed the same,

OP, be aware you may end up on a higher rate, obviously this depends on the mortgage product you have been offered.


I suppose it depends on the lender as to how long it takes

redonion

monty-doggy wrote: »

I changed my deposit after negotiating after the survey, I reduced mortgage and so increased my deposit to loan ratio. It took a few days.

Thanks for that data point - at least I now know it's not impossible the same could happen with mine!

Why would you pay more than the house is worth? Surely you should negotiate the price, then change the mortgage?

Have you ever bought a property in London in the middle of a seller's market of this magnitude? I'm not saying I won't negotiate, but that is a reason why one might choose not to.

If the bank base it on the lower valuation you might get a better interest rate based on your LTV?

On this particular point, it so happens it's not going to make a big difference to the rate in my case. Also, I am otherwise close to exchange.