Loan to Value on Re-Mortgage

LDN>HK>LDN

Hi,

I've noticed that house prices seem to be rising quite rapidly in the area I live (Greater London/Kent borders).

My fixed term with HSBC has just finished and I've dropped down to the SVR, which is a little less than what I was paying on my fixed. I'm keen to fix it gain for another 2 years.

I purchased the house in 2012 and my LTV currently stands at just over 85%. Sadly, HSBC have tiers for LTV rates at whole number points (ie 90, 80, 70, 60% and so on), so even if we were to add a few quid from our savings to take it below 85% we won't make a dent on the rate we are paying.

Given the upturn in the housing market in my locale, I was wondering if they would consider re-evaluating the value of our property. I suspect they do this anyway to ensure it is still in a fit state to lend against. But I was wondering to what lengths they will go (ie desktop valuation, full standard valuation etc). If it is a case that they will want a full valuation with a visit from a surveyor, I wonder if we would be better off shopping around first. Given we are existing customers, would a desktop review be likely???

Thrugelmir

In such circumstances the first thing you should do is ring and ask.

kingstreet

As an existing borrower wanting a new deal, an indexed valuation will be used. Some lenders will allow you to pay for a drive-by, or an internal inspection if you think the value would be higher, but that's at your expense.

As usual, can't speak for HSBC as no experience.

ChopperST

Sorry for the hijack OP.

@Kingstreet - are you aware of the Skipton's protocol here? Do they retain the original valuation or can they index link it for you without paying a new product fee?

kingstreet

No idea, sorry.

Brokers tend to only get involved with customer retention products when they get paid and AFAIK Skipton don't pay procuration fees on product transfers.

LDN>HK>LDN

For anyone interested. The bank did an indexed review (as kingstreet mentioned).

The value, according to that, has increased substantially, which means we were easily under the 80% LTV mark. In fact we were quite clost to 70%, but I didn't want to push my luck considering that if another valuation came in at a higher LTV they'd be duty bound to use that one instead.

Either way, I've managed to shave off £340 per month from our original fixed deal and £220 versus the standard rate that the mortgage was about to revert to.

Probably could have got a slightly better deal elsewhere (maybe saving a further £100 or so per month), but after we factor in the cost of having a survey and paying the mortgage arrangement fees with another lender the saving would have been neglible. Plus our circumstances have changed since we got our original mortgage (have a baby now, wife only works part time, have a few CC debts to service), so didn't want to go through the process of changing only for other lenders to turn us down anyway.

All in all a good win.

ChopperST

Pleased it worked out for you OP.

Hope we can do the same come renewal time.