Mortgage devalued at the last minute - advice please

chrisbspm4

Hello

Please could someone help and offer me some advice.

My wife and I are first time buyers and we found a new build that we bought off plan. Completion date of end of June. We applied for and were accepted for a mortgage with Nationwide. I got a call today from the broker stating that Nationwide have devalued the house by £10, 000 (we agreed on £160, 000). Nationwide can now no longer offer the mortgage.

The home builder has agreed to pay the fees to start a new mortgage application with Halifax as they are 'convinced the valuation from them will be 160,000 as they have sold all houses in the plot with no devaluation to date'.

I feel uncomfortable about paying 160, 000 for a house that has been valued at 150, 000, even if the second valuation comes back as 160, 000 I cannot forget the first one.

I am being told that Nationwide commonly undervalue houses and that the home builders are so convinced the second valuation will be 160, 000 that they will pay. This is alarm bells to me as I bought the new build for 160, 000 and the asking price was 162, 950. I have regretted not offering less and in my gut I always felt like I could have offered less.

I am keen to avoid the home buyer's sales talk and keen to have some advice before speaking with them for more detail. Is it worth renegotiating? The broker seems to think not and that they won't budge, but then again they want to gain their commision in the easiest way so would say that.

The home builder and broker seem to not be concerned by the undervaluation and want to gloss over. Am I right to be questioning this?

Thanks

James

Thrugelmir

You bought off plan so the mortgage was always in principle so subject to......

Developers use all manner of tricks to hide the true selling price. Most common is incentives. Flooring, garden landscaping etc which get buried in the selling price. All that matters to the developer is the value that appears at Land Registry.

Smoke and mirrors......

Have you exchanged contracts already?

chrisbspm4

Hello

We bought off plan in December and actually agreed a mortgage at 160, 000. It is not a decision in principle, it was a mortgage offer. At the same time they valued the house at 160, 000. Now the mortgage lenders have changed their minds on the valuation.

We have not formally exchanged and can still back out with a loss of around £800. It is help to buy so thr government have not sent an authority to proceed yet

We are buying the house with no extras so the 160, 000 is for the house with no incentives such as turf or flooring.

Thrugelmir

chrisbspm4 wrote: »

At the same time they valued the house at 160, 000. Now the mortgage lenders have changed their minds on the valuation.

Ok. My confusion as you said off plan. Assumed there was no building to value. Now the property is nearing completion and has been reinspected.