Mortgage valuation lower than agreed sale price - FTB

suski1

Thanks again for input. All very helpful.

Can someone try and help me understand the financial situation... if I decide to continue with the sale based on £155k and the mortgage lender values the house at £147 then I would be asking for a £92k loan rather than £100k (147 - 55k deposit) I would then have to pay the additional £8 to the seller somehow? Is this correct?

Sorry if this is a really stupid question - just really want to understand the situation before I proceed in anyway

Thanks

amnblog

Your note suggested the valuation does not affect the loan so it appears you can still borrow £100,000 on a £145,000 valuation (assuming the damp and timber report is ok).

They may even lend you more depending on the product limits and your underwriting position.

Check your options with your broker.

suski1

Thank amnblog.

Does this mean I could potentially pay a smaller deposit. If I wanted to pay the additional £8k to secure the house how would this be done?

shortchanged_2

adindas wrote: »

Need to be aware of the game the surveyor is playing.

If they are working for buyer (and lender) surveyor will always value the house the same and in many cases below the asking price. The explanation is very simple. To cover their back against future claim made by you or the lender (via buyer) ......

Aren't the majority of surveyors working for the buyer/lender?

amnblog

suski1 wrote: »

Thank amnblog.

Does this mean I could potentially pay a smaller deposit. If I wanted to pay the additional £8k to secure the house how would this be done?

Subject to the limit of the mortgage product and your underwriting situation.

This would of course not be my recommendation as stated earlier.

Do not overpay.

Thrugelmir

shortchanged wrote: »

Aren't the majority of surveyors working for the buyer/lender?

For the lender unless the buyer is a cash buyer or the buyer has instructed the surveyor to conduct additional services.

ViolaLass

suski1 wrote: »

Thank amnblog.

Does this mean I could potentially pay a smaller deposit. If I wanted to pay the additional £8k to secure the house how would this be done?

IF you did this (and you're being advised not to), you would pay £8k less deposit but have to give that £8k to the seller instead. It wouldn't save you anything.

Dan-1987

Sounds like perfect grounds to reduce your offer to £145k does it not?

adindas

shortchanged wrote: »

Aren't the majority of surveyors working for the buyer/lender?

When did I say otherwise ??

Obviously, the majority of surveyors working for the buyers/lenders but sometimes the sellers might want to appoint his/her own surveyors if they want to challenge the valuation did by other surveyors or want to know the value for their property or the condition for their property ...

suski1

I'll be speaking to estate agent first thing about renegotiating the price. Thank you for the advice