Mortgage Valuation a whopping 77k under agreed sale price

slowpoke_rodriguez

Go back to the agent tomorrow and tell them of the low mortgage valuation. I doubt they'd be that surprised. Tell them your new offer, and that it is your final offer. If the vendor rejects it then the agent has lost a sale. Simples.
You could try another mortgage co but that will take time, but don't prat about trying to over-think it or you'll lose the house. Offer what you can afford and are willing to pay.
It's not the vendor's fault that you think it is worth more than the lender does.

Lloydage

House network won't care about a lost sale. They are an online agent that only charge sellers 500-1000 quid.

warby68

Lloydage wrote: »

a couple of replies on here are quite offensive. I'm looking for help/advice. Not to be told how stupid I am.


I will report any responses of that nature

People are blunt around here but you do need to take heed of the underlying message before you start further negotiations.

You are emotional I suspect because your 'dream' is potentially being snatched away - you want to blame a 'greedy' seller. But he is no more greedy than you are stupid. There's a lot more heart and art in house selling/buying than there is science. If you were willing to pay £730k or so, then probably so will someone else.

My advice? You need a mindset shift before further negotiation. Don't whatever you do let your greedy vendor opinion be known , you will alienate. You want the vendor onside so its not the seller's fault, its not your fault - its a wonderful house but the mortgage people are placing a limit on you.

Seriously consider how much you want it in the worse case scenario of the vendor not budging - guess it would put you c 85% LTV - is that affordable?

Alternatively if the vendor is not ready to drop and you have a genuine top line of say £700k you can always leave it on the table rather than 'take your ball home' and just see what happens in the next few weeks. Vendor will see you as genuine and committed just price limited (hopefully)

Although its a high value house, you sound like a FTB ? Apologies if wrong but that gives you some edge too as you can proceed.

In short, hostility towards vendor and belief that he somehow conned you just will not wash. Put another way, most vendors over rather under value and around 10% variance isn't much really especially as you move to higher value and niche properties.

eddddy

Negotiation is just a game. You could invite the seller to make the first negotiation move by saying something like this to the EA...

Santander's valuers have valued the property at £660k, so obviously we can't pay £737k. Can you ask the seller how close to £660k the seller is prepared to go?


(If the seller concedes to, say, £725k - it then seems like a smaller drop to, say, £700k.)

The problem is that House Network aren't really negotiators - they are just 'message passers'. A traditional EA would actively negotiate to try to broker a deal.

Andypandyboy

I know where you are coming from, you offered a price based on a reduction from a price you believed was market value. When the survey revealed the market value was much less it became "worth" less in your eyes obviously. The vendor has an emotional attachment to a home he has worked on and lived in so his sense of "worth" is much different to yours.

You need a mortgage, there is a shortfall, so you now have to rationalise dream home over potential market value and offer accordingly.

The seller wants the best price, so you do you. You have to be able to agree and be happy that the house is worth to you what you have paid. That price may or may not be actual market value.

Crashy_Time

Lloydage wrote: »

a couple of replies on here are quite offensive. I'm looking for help/advice. Not to be told how stupid I am.


I will report any responses of that nature

The price he paid three years ago should ring alarm bells, especially at this stage of the biggest property bubble ever and with emergency interest rates etc. Has he really added nearly 400k`s worth of value? IMO you should walk away.

Crashy_Time

warby68 wrote: »

People are blunt around here but you do need to take heed of the underlying message before you start further negotiations.

You are emotional I suspect because your 'dream' is potentially being snatched away - you want to blame a 'greedy' seller. But he is no more greedy than you are stupid. There's a lot more heart and art in house selling/buying than there is science. If you were willing to pay £730k or so, then probably so will someone else.

My advice? You need a mindset shift before further negotiation. Don't whatever you do let your greedy vendor opinion be known , you will alienate. You want the vendor onside so its not the seller's fault, its not your fault - its a wonderful house but the mortgage people are placing a limit on you.

Seriously consider how much you want it in the worse case scenario of the vendor not budging - guess it would put you c 85% LTV - is that affordable?

Alternatively if the vendor is not ready to drop and you have a genuine top line of say £700k you can always leave it on the table rather than 'take your ball home' and just see what happens in the next few weeks. Vendor will see you as genuine and committed just price limited (hopefully)

Although its a high value house, you sound like a FTB ? Apologies if wrong but that gives you some edge too as you can proceed.

In short, hostility towards vendor and belief that he somehow conned you just will not wash. Put another way, most vendors over rather under value and around 10% variance isn't much really especially as you move to higher value and niche properties.

Mmmm...I wonder why? Buy at any price is shockingly bad advice for this stage of a property bubble.

MobileSaver

Crashy_Time wrote: »

especially at this stage of the biggest property bubble ever ... IMO you should walk away.

Crashy has been talking about the "biggest property bubble ever" for years and his friends at HPC have been doing the same for over a decade so be sure to take that into account when considering the value of his opinion...

silvercar

Lloydage wrote: »

A related question is what price do I go back to house network with on Monday?

Ultimately I don't want to pay much if anything over 700k for this house.

Do I go in with 670k and begin haggling process or just say 700k is our final offer? never know best way of starting these chats. Once you say final it doesn't leave anywhere to go. Equally starting very low eg 670k he may think we are not serious at all and will laugh at that offer.

It is a difficult chat and you have to engage with the seller. After all you are devaluing their prize asset. No point alienating them unnecessarily.

I would start with saying that you fell in love with the house, offered relating to the asking price and have now hit a problem.

You have the mortgage valuation and it is 670k. This causes you a problem as (a) the mortgage company bases their mortgage on what the property is worth and (b) you were basing your prepared price on what it is worth and obviously that has now changed.

You realise that will be a disappointment to them, but would like to point out that if they don't sell to you, then their next potential buyer will face the same issue.

Then I would be inclined to say you are reconsidering and will get back to them in 24 hours. Or you could ask them what sort of price they could consider accepting in the light of this new information.

Crashy_Time

MobileSaver wrote: »

Crashy has been talking about the "biggest property bubble ever" for years and his friends at HPC have been doing the same for over a decade so be sure to take that into account when considering the value of his opinion...

The sentiment in the MSM and the fact that the OP`s lender does not want to play ball indicates to me that the seller is just kite flying, and may end up with a lot less for this property than they imagine.