New build valued at less than asking price

hello_petal

kingstreet wrote: »

HTB Equity Loan?

What percentage deposit or LTV?

Not HTB and 15% deposit.

I can't go to 10% deposit as the rate and monthly payment jumps considerably. I get the best mortgage deal at 15% which was already stretching my savings to get this.

kingstreet

Halifax normal maximum LTV for a newbuild is 80%, so you are accessing their special 85% newbuild products by virtue of buying from one of their bigger builders.

The loan and any newbuild cash incentives cannot exceed 90% of the property value. Is that the case?

If so, you may find the valuation comes back lower than the agreed price as the value of the cash incentives may be deducted.

hello_petal

kingstreet wrote: »

The loan and any newbuild cash incentives cannot exceed 90% of the property value. Is that the case?

No - I didn't receive any cash incentives from the developer. They included flooring (value £3.5k) as an upgrade and Halifax advised this would be fine and in relation to the mortgage not considered a cash incentive. Still doesn't explain the £8,995 undervaluation.

My solicitor is puzzled as to why the property has been undervalued as the site is active and selling well. I guess I'll wait to see what Barratt say before going back to the bank but I'm not hopeful they'll re-evaluate if this is the case.

If neither are prepared to back down then I may need to walk away from the sale. Gutted.

kingstreet

You'll probably end up with Barrett offering to refund the price of another valuation if you change lenders. They will be unlikely to accept the valuation, especially if they have numerous sales going through at the price they agreed with you.

On any site, you sometimes get a surveyor who comes in from outside during illness or holidays and you get a one-off downvaluation. Did a Colleys surveyor do the valuation or was it panelled out? Barrett will know who came out when you discuss this with them.

Yorkshireem

We hadn't this exact situation. We put in an appeal with the valuer (which was rejected), and them went to the developer who agreed to drop their price by 10k. My advice, show the developer you have done all you can and ask for a drop in price. They make massive profits on these houses and your difference will not be a problem to them.

Silvertabby

Does the Barratt price include white goods?

hello_petal

Silvertabby wrote: »

Does the Barratt price include white goods?

No, they will supply integrated appliances as an upgrade.

hello_petal

kingstreet wrote: »

You'll probably end up with Barrett offering to refund the price of another valuation if you change lenders. They will be unlikely to accept the valuation, especially if they have numerous sales going through at the price they agreed with you.

I don't really have an option to change lenders as Halifax were one of a limited few available to me. I've banked with them for years so I was happy to proceed with them.

kingstreet wrote: »

On any site, you sometimes get a surveyor who comes in from outside during illness or holidays and you get a one-off downvaluation. Did a Colleys surveyor do the valuation or was it panelled out? Barrett will know who came out when you discuss this with them.

Yes, it was Colleys surveyor.

TBeckett100

Halifax usually allow 5% of the value as incentives

kingstreet

TBeckett100 wrote: »

Halifax usually allow 5% of the value as incentives

Only where the LTV is 80% or less.

Incentives are restricted as I noted above where the LTV is higher. For example, at 90% no incentives are permitted and they will be deducted from the valuation.

It's also different for HTB Equity Loan cases, where incentives are limited to 1% where the applicant deposit is only the 5% minimum.