Mortgage valuation criteria

hounsehunterftb

Hello guys!

Thanks in advance for reading. Just needed some information or background about criteria on which the mortgage is lent on a particular house.

Hypothetically, say I am buying a house for £125,000 on which I am paying a deposit of 10% and potentially asking a mortgage of £112,500.

However say after valuation it turns out the house is actually worth £120,000. But it is still more than my required mortgage of £112,500.

Would they consider giving me a mortgage since my property is still priced higher than what I am asking for?

Though the above figures are hypothetical, I feel I am / might get in to a similar situation where in the valuation becomes less than the offered price.

I have applied for a mortgage with Principality. Anyone having any experience with them?

(My valuation is booked for 14th! Fingers crossed!!! I hope all goes well. But I am just so nervous thinking about it that I feel sure I am going to land in this situation! )

kingstreet

No. The closeness of what you want to borrow and the valuation increases the risk to the lender in the event of repossession.

That's why those with a 40% deposit get a better rate than those with a 25% deposit who get a better rate than those with a 10% deposit and so on...

hounsehunterftb

@kingstreet Hello Thanks for your response.

We just received our home buyers survey valuation which is exactly our "offer price".

Now we did our home buyer survey alongside mortgage lender's valuation.We paid extra and used the same surveyor for our home buyer survey

Would the same property valuation given be given to the lender which was given to us?

Thrugelmir

You'll just receive a more detailed report from the surveyor.

We just received our home buyers survey valuation which is exactly our "offer price".

The surveyor is simply confirming to the lender that the property is priced correctly and as of being adequate security.

hounsehunterftb

What I wanted to ask is, since we got home buyer survey done from lender's surveyor the valuation for the property that we got in our report would the exact same price be given to the lender as well?
Since the same surveyor was used

And its exactly equal to our offer price and with us having 10% deposit (assuming our credit history and documentation is all fine), would we have any hurdles with the mortgage now ?

kingstreet

I cannot imagine any circumstances in which a single surveyor carrying out a mortgage report and valuation for a lender and also carrying out a report on condition for the potential purchaser would reach two different valuation conclusions.

It would make no sense.