Lender down valuing property

Roodle47

I am hoping someone can shed some light and offer some advice.
I am a first time buyer and have recently had an offer accepted on a house. After the lender doing a basic survey, the lender has down valued the property £10,000. (This is one of the top high street banks).
For some reason (maybe it's to do with only having the basic survey), the lender / surveyor are not willing / able to give me a copy of the survey or even the reason as to why they have down valued it so much. I am now stuck as the estate agent is adamant that the property is not over priced (of course!) and are not willing to go to the vendors without having the reason behind the down valuation.
The estate agent is sure the surveyor has not done their research properly on the area.
I am now stuck...any advice anyone can give at all would be much appreciated.
Many thanks
Ultra-confused 1st Time Buyer

theartfullodger

Undoubtedly the agent is talking b*ll*cks, Offer a lower price (you chose): If not accepted walk away.

nubbins

The bank is there to protect its investment as well as make money, they will quite often downvalue properties especially when they have risen substantially recently (depending where you are). As others have said forget what the EA has said and either find the extra 10k yourself or reduce the offer, the vendors may have problems again if they put it up for sale if you pull out.

BristolBob

They haven't 'down-valued' it. They have assigned it a value that they feel appropriate in the circumstances. It could be said that the estate agent 'up-valued' it.

nubbins

Yes it could be but quite often they either get it wrong or as I said down value it and before you say anything I 100% know this from personal experience

[Deleted User]

I recently witnessed a lender's surveyor do a basic survey and it only took them a few minutes. They didn't even go into all the rooms, just stuck their head in and took a photo. They told me that the survey was basically to check that the house exists and has four walls etc. Therefore I think the estate agent may have a better idea of the real value of the house.

Surrey_EA

[Deleted User] wrote:

I recently witnessed a lender's surveyor do a basic survey and it only took them a few minutes. They didn't even go into all the rooms, just stuck their head in and took a photo. They told me that the survey was basically to check that the house exists and has four walls etc. Therefore I think the estate agent may have a better idea of the real value of the house.

The visit by the surveyor on behalf of the bank is not a survey. The surveyor will be there purely to protect the interests of the lender, and to confirm the property in question is suitable security for the mortgage.

davidmcn

[Deleted User] wrote:

I recently witnessed a lender's surveyor do a basic survey and it only took them a few minutes. They didn't even go into all the rooms, just stuck their head in and took a photo. They told me that the survey was basically to check that the house exists and has four walls etc. Therefore I think the estate agent may have a better idea of the real value of the house.

The OP's surveyor is unlikely to have missed something in the property which would cause them to enhance the value by £10k.

AlistairM

I had the same problem, the banks survey undervalued the property by £15K


I negotiated the price down by £5K and had put up the other £10K myself.


With my property I'm convinced the surveyor never laid eyes on the house.


I had a homebuyers report carried out and they valued it at £32K more than the banks

*BigBird*

Valuers don't always get it right. We had the same problem with the surveyor valuing the property we're buying at £7k less than we'd offered. He was based 50-odd miles away and admitted he'd never even been to this town before and didn't know the market! We, on the other hand, know the market very well as we've been looking for a bigger property for a while, but thought we'd need to wait til my youngest DS started school before we could afford what we wanted. Then this house came on the market and is perfect and in our budget now (the owner is relocating for work and so was looking for a quick sale, hence the relatively low price for the area)

The surveyor seemed to be basing his valuation on a 4-bed house around the corner that sold last year for £35k less than ours was on the market for. However, whilst on paper both were 4-bed detached houses, that one was significantly smaller than the one we're buying, needed a lot of updating inside and had a tiny and very dingy garden that was very much overshadowed by the house directly behind it.

We challenged the valuation and sent evidence to support our challenge. The surveyor disagreed and stuck with his original figure. I currently have a complaint ongoing with the bank as they won't give me a copy of his response - a response to my challenge, in which he comments on the evidence I've sent, so no I don't agree that it's between him and the bank, thanks very much!

We didn't see how we could renegotiate our offer without knowing the surveyor's reasons for rejecting the challenge (or whether he'd come up with some bombshell we hadn't considered, but I highly doubt that's the case.) So we've stuck with our original offer as quite frankly we think it's a good price based on what houses of that size in this area normally sell for. However we are in the fortunate position that the house is only a 5 minute walk from our current one and we do know the area and the market very well, so are confident in our own valuation of that property.

We had a slight issue as the mortgage offer we had was for 65% of the value and we were borrowing up to that level, so it looked like we might need to reapply for a different rate because of the lower valuation. It turns out there is some leeway with the bank to go over the LTV % because, as they told me on the phone, they do build in a margin for error in case the valuation isn't accurate - further evidence that you shouldn't necessarily take the valuers word as gospel!

Roodle47

*BigBird* wrote: »

Valuers don't always get it right. We had the same problem with the surveyor valuing the property we're buying at £7k less than we'd offered. He was based 50-odd miles away and admitted he'd never even been to this town before and didn't know the market! We, on the other hand, know the market very well as we've been looking for a bigger property for a while, but thought we'd need to wait til my youngest DS started school before we could afford what we wanted. Then this house came on the market and is perfect and in our budget now (the owner is relocating for work and so was looking for a quick sale, hence the relatively low price for the area)

The surveyor seemed to be basing his valuation on a 4-bed house around the corner that sold last year for £35k less than ours was on the market for. However, whilst on paper both were 4-bed detached houses, that one was significantly smaller than the one we're buying, needed a lot of updating inside and had a tiny and very dingy garden that was very much overshadowed by the house directly behind it.

We challenged the valuation and sent evidence to support our challenge. The surveyor disagreed and stuck with his original figure. I currently have a complaint ongoing with the bank as they won't give me a copy of his response - a response to my challenge, in which he comments on the evidence I've sent, so no I don't agree that it's between him and the bank, thanks very much!

We didn't see how we could renegotiate our offer without knowing the surveyor's reasons for rejecting the challenge (or whether he'd come up with some bombshell we hadn't considered, but I highly doubt that's the case.) So we've stuck with our original offer as quite frankly we think it's a good price based on what houses of that size in this area normally sell for. However we are in the fortunate position that the house is only a 5 minute walk from our current one and we do know the area and the market very well, so are confident in our own valuation of that property.

We had a slight issue as the mortgage offer we had was for 65% of the value and we were borrowing up to that level, so it looked like we might need to reapply for a different rate because of the lower valuation. It turns out there is some leeway with the bank to go over the LTV % because, as they told me on the phone, they do build in a margin for error in case the valuation isn't accurate - further evidence that you shouldn't necessarily take the valuers word as gospel!

The EA has tried to encourage us to argue it with the lender by using a couple of examples she has from "similar" properties. Unfortunately the properties that she has picked, are quite a bit different to our potential purchase. They are only slightly more expensive than the our purchase but yet have a relatively large extension / a conservatory in addition to being a bit more updated anyway. Her evidence didn't convince me - let alone the bank! - but instead put even more doubt in my mind. We are waiting to hear whether the vendor is willing to negotiate.

My gut is telling me we are paying too much for this property; good location and I'm sure some houses in the area will go for that price but I think they would have a bit more to offer.

Thanks everyone for your help and input..much appreciated!