Mortage Offered and accepted but withdrawn for mistake by surveyor Can this happen?

Bigbear100

Hi

We have had a mortgage offer from Precise and accepted this offer and were awaiting a completion date from the solicitor, the solicitor has refereed back to precise as the property is leasehold and has only a short lease remaining.

Precise were aware of the lease length from the beginning and accepted it, the surveyor has come to value the property but on the report put the property as Freehold instead of leasehold and from that Precise are now declining to offer.

Can they do this as we have already accepted the mortgage and have not provided any false information to them.

Any answers on this would be great!

Thanks

stator

I hope you haven't exchanged contracts yet?

Is this England?

Bigbear100

We have signed to accept the mortgage but not completed

We are in Wales

Contemptuous

Potentially yes.

If the valuer thought the property was freehold they would have valued it on that basis. I'm assuming the estate agent didn't tell them about the short lease?
The valuer will now need to revisit their original valuation on the basis of the short lease, which will affect saleability. It may now be valued less which will affect your LTV. The valuer could now decide it is unmortgageable due to the length of lease remaining. Could you look at extending it?

cycloneuk

They can withdraw the offer right up to completion, how long is left on the lease since Precise criteria shows '30 years unexpired term after end date of the mortgage term.'

Contemptuous

How many years are left on the lease?

ACG

Im sure this can be resolved. Your broker just needs to make Precise aware and for them to get in touch with the surveyor.

Assuming the length of the lease is within what Precise accept then there should be no issue once the surveyor updates the report.

Bigbear100

The lease is 51 years and we are looking at an 18 year term the lender has been aware of it from the outset and fits within their lending terms
we have looked at extending the lease but dont have the funds readily available to do so and this is linked to a new purchase as well

Thrugelmir

Bigbear100 wrote: »

The lease is 51 years and we are looking at an 18 year term the lender has been aware of it from the outset and fits within their lending terms

But the surveyor wasn't. Which may well impact the valuation.

stator

Bigbear100 wrote: »

We have signed to accept the mortgage but not completed

We are in Wales

But have you exchanged contracts with the person selling the flat? Ask your solicitor if you don't know what it means, it's the point at which there is no going back and you are comitted to buying the flat. Anything that happens before exchange of contracts you always have the option of walking away. Things that happen after exchange of contracts are more scary :eek:

amnblog

I suspect the issue here is not the term of the lease but the impact the short lease term is having on the valuation.


Didn't quite follow what is going on, but has the valuer altered their view on value having released it is short lease?