Mortage Valuation

heyjim

Hi all,

I'm due to have my mortage valuation and survey done this week but have a niggling thought in the back of my mind.

As an example, say the house costs £200,000 and I put down £50,000 deposit, will the lenders look for a valuation of at least £150,000 given thats what they're lending? Or would it need to be the full £200,000?

Thanks

MrJB

If you're applying for a product with a LTV of 75% then they will want it to value up at £200,000. You will be getting a better rate of interest which reflects the risk to the bank. If it valued up at £160,000 you were paying £200,000 for it, they would be significantly more exposed lending £150k.

HouseBuyer77

They look at the actual value with no reference to your deposit. The product you've got will have a minimum LTV which will then give you the minimum deposit required to get the mortgage.

If the valuation is below your agreed price you will need to find extra money (often done by reducing deposit but if this takes you through the LTV minimum for the product you'll need to get a new mortgage) or use this to negotiate the price down.

So if you agree £200'000 purchase price you want a £200'000 valuation

benjus

They will look for a valuation of £200k. If it comes in at (say) £190k then either:

• You renegotiate with the vendor to get the price down to £190k and proceed.
• You stay with the £200k sale price but look for 79% LTV mortgages instead of 75% LTV
• Somewhere in between the 2 options above.
• You pull out.

McTaggus

They will look to see if the valuation is as per the full price that you are paying, so that they can check that you have the appropriate LTV ratio.