Valuation!!

han2505

Well everything was going smoothly, was meant to be exchanging contracts last friday and we were waiting on the Valuation to be done.

Well the valuation person came out and he under valued the house by 5%. We found out that he was a bit annoyed as he hadnt told anyone he was there and so was kicked off site. BUT we also found out from him that he didnt like incentives with the new builds and as were getting our 5% deposit paid for us he had knocked it off. Can he do this?
He is now refusing to increase the price, so were having to get another valuation company out.

Has anyone been in this position before? what happens if it carrys on getting under-valued? Will we lose the house?

Just a bit worried as it's due for completion in 2 weeks.

Thanks

Mr_helpful

Did you tell the lender there was this 5% incentive?

dunstonh

The valuer has acted correctly. Builders paying deposits is a known scam and one that is putting may new landlords under financial difficulty. Builder increases property value above market value but the reduces it back to market value in your eyes by giving you what they call a deposit. Valuer comes out and values it at the real value and you don't get the deal you want.

Lenders have known about it for a while and some let it pass (some wouldn't). However, since the credit crunch it is an issue that has come increasingly under the spot light.

Dan_Collins_2

dunstonh wrote: »

The valuerer has acted correctly. Builders paying deposts is a known scam and one that is putting may new landlords under financial difficulty. Buildier increases property value above market value but the reduces it back to market value in your eyes by giving you what they call a deposit. Valuer comes out and values it at the real value and you dont get the deal you want.

Lenders have known about it for a while and some let it pass (some wouldnt). However, since the credit crunch it is an issue that has come increasingly under the spot light.

Spot on, he has done his job protecting the lender and really the client. He can do this but to change his mind you need to show property if the same type selling for the same price within the area. I would bet that you could not as you pay a premium for new builds.

Some lenders are already putting 85% LTV max on new build flats as there are so many of them and the prices are inflamed!

Sorry we cant be more positive but I have had to deal with this a bit this month. I had a client pay £315 for a new build, a year and a half later its worth £315.