Failed mortgage valuation

hmapoet

Hi everyone,

We are first time buyers and applied for a mortgage with Santander. All our credit checks and affordability was fine. The valuation however was not.

The valuer advised the lender not to lend on the property full stop because it is 'poorly laid out and badly lit'. It has baffled both my mortgage adviser and estate agent.

In all fairness the property has been on the market since last Christmas which made me suspicious but the estate agent assures me that was only because the previous buyers chain broke down and they had to pull out.

There is also asbestos cement in the extension. I only know this because the seller told me independently and assured us that it is in perfect condition and minimal risk. The mortgage valuer didn't pick up on this though. We planned to get our own valuer to check it out after getting a mortgage offer.

All of this looks bad and yet there's no tangible reason for the valuer not even putting a price on it! The flat is really lovely. Small but perfect for a couple starting out.

We are considering trying another lender but obviously I don't want something that will be hard to sell but at the same time I can't work out why it's turning out to be so difficult.

I just wondered if anyone else had a similar experience with the valuation?

Thanks!

Mortgage_Mark_2

Seems a bit bizarre for the reason 'poorly laid out and badly lit' to say that it's not mortgageable full stop - what's unusual/poor about the layout?

Generally you can appeal a valuation if it comes back low, but generally speaking you don't tend to be successful all that often (if ever) as you're basically asking a surveyor to overturn his professional opinion.

Also bear in mind that there is a record of all valuations carried out by RICS surveyors, and as such it's likely that this would be a problem if you applied elsewhere and that lender used a different surveyor company to Santander.

Do you have the valuation report?

I'd see if you can get hold of the valuer to get a more detailed explanation.

hmapoet

Thanks for your reply!

It's not an unusual layout and there are lots of windows so I am confused. We are waiting for a copy of the report and I think our agent is requesting that a different valuer attends on behalf of Santander. I have no idea if this request will be successful.

Why do you think it would it also be an issue with a different lender? If they used a different valuer wouldn't there be the chance that they would view it differently or at least give a solid reason?

Mortgage_Mark_2

It's possible but generally speaking if there's been a valuation within the last six months (or six weeks in this case?!) then they may even refuse to value the property, and just default to that valuation.

That's very much worst case scenario to be fair. I think you'd be best waiting for the report to see what the valuers comments are around why the value is effectively £0.

hmapoet

Okay so the valuer said:

"Elements of the property are in poor condition considering it’s age and type.
The property is a small lower ground floor flat at the rear of the block which is in poor condition, poorly laid out and poorly lit. Due to this the property is not suitable security for Santander lending purposes."

I disagree but even if it was the case why wouldn't they downvalue it? We could have negotiated with the sellers and arranged to do the work required!

They have let us appeal and we have booked a different valuer. It is at our expense but the first valuation was free so it's not too bad.

Fingers crossed it will be a bit clearer regardless of the outcome!

amnblog

It appears the two people encouraging you to buy this property are strangely two individuals who stand to benefit if you do.


Walk away.

hmapoet

Hi amnblog!

I suppose but my family and friends have also said how strange a reason it is and that I should get a second opinion.

It's hard to see the valuers logic. The seller didn't struggle at valuation and nor did the previous prospective buyer (it fell through because they lost their buyer).

If it truly is not worth it then hopefully the second valuer will at least give the reason why. If they said it's damp, or it's going to fall down or something I would totally accept that but I find a 'poor layout' a bit too tenuous and subjective.

I think a second opinion would at least give some closure.

amnblog

You don't need closure. You need to take the smart view.


If a valuer is saying it is not suitable security you need to remember they are not idiots, they are professionals.


if the property is not suitable security this affect the resale potential.


Buy it and you will regret it.

Mortgage_Mark_2

Bear in mind that they have confirmed that it is not suitable for Santander's lending purposes, i.e. it's not within their lending remit.

Which bank/building society did the previous purchasers use? There may be something else about the property that makes it unmortgageable for Santander?

kaya

I think some of the valuers are on a power trip, they agreed the value of our property for our buyer but apparently mentioned "lots of repairs" that are needed ,been here for 9 years and have no idea what repairs he was on about!

amnblog

You have owners eyes - valuers are lenders or buyer eyes.