Mortgage survey down valuation!!

MissB1990

Me and my partner are first time buyers. We recently fell in love with a property in Derby. We offered the asking price of £150,000, maybe this was a mistake on our behalf as we didn't properly research other housing values in the area and we let our heart rile our head.

Our mortgage got accepted with no issues, they had originally given us a mortgage in principle for £180,000 as we were looking at first for properties in this price range but really fell in love with the property we made an offer on and with it been a lot cheaper it gave us the opportunity to decrease our term time.

Everything was moving along nicely until it came to the survey. They went out and did this Tuesday and the bank rang my partner last night saying I am sorry about the valuation. We had no idea what she was talking about and she thought the surveyors had been in touch which they hadn't.

The survey basically said there is nothing at all wrong with the house and it's really nice but it's just not worth £150,000 therefore the bank will now not give us the mortgage for that. They have valued it at £142,500. They said that no other property in the area has sold for £150,000. The property next door actually sold for £153,000 last year they said it was due to it having an extension. All the properties on the street however are very different or just not been up for sale for many years so how they can compare it to other properties is beyond me.

I am distraught because we really want this property and now risk losing it. We have told purple bricks the situation and they are going to go back to the vendor with another offer but now I am just worried they will regret it.

If we wanted to could we up the offer to say £145,000, the bank is only willing to give us £142,500 but if we put in the remaining £2,500 would this be possible?

Any advice on how we should go about this and not lose the house or anyone that has been in a similar situation I would appreciate it a lot. It's so stressful been first time buyers we feel like we have no clue what to do.

davidmcn

MissB1990 wrote: »

If we wanted to could we up the offer to say £145,000, the bank is only willing to give us £142,500 but if we put in the remaining £2,500 would this be possible?

Yes, if you have enough cash to make up the difference you can ignore the lender's valuation and offer what you like.

amnblog

A few points Miss B.

The fact you are in love with the property does not make it worth £150,000. The valuer may be right and you intend to overpay by £7,500.

There are ways you can appeal the valuers decision. But bear in mind this is rarely successful. Talk to your lender or broker on how to do this.

The lender has offered you £142,500 based on a £150,000 valuation (95%) of the valuation.

If it values at £142,500 they will not offer you £142,500 lending on £142,500 valuation.

Your maximum lending will now be £135,375 on £142,500 valuation.

You could tell the vendor that the property has not valued up and your offer is now £142,500.

Also, bear in mind, that from our experience of squillions of purchases, where our clients lose the first property because it does not value up, the second property they find is always a much better deal. It seems to sharpen the bargain hunting instincts.

kingstreet

Comparables used by surveyors are typically;-

similar properties
within 0.5 miles
sold within last four months.

Look here to see what there is;-

http://www.rightmove.co.uk/house-prices.html

Goath

kingstreet wrote: »

Comparables used by surveyors are typically;-

similar properties
within 0.5 miles
sold within last four months.

Hi sorry to Hijack this thread, however I read with interest. I have made a post in the house buying forum about a valuation on my house that I am selling. I don't want to give to much information on here BUT please see my previous post


https://forums.moneysavingexpert.com/discussion/5759248


In a nutshell I am prepared to sell my house, for what is an average that I have worked out of prices in my street (where there is a mixture of different property types) (more details in my linked post)- but how can they just "come up with a valuation" when there has not been any properties sold in 6 months?


Also I was talking to our next door neighbour, and they bought their house about 8 months before we did (its exactly the same as our house) they said that on their survey, it stated "non standard construction" and they had a problem getting the mortgage for their property where as on ours the Question, "is the building of non standard construction" the surveyor ticked "NO"


Therefore, call me cynical, but I really have to doubt that a surveyor actually knows what they're doing and just come up with random figures on what they reckon instead of fact.


I am losing so much sleep in worrying that my property is going to be down valued when I come to sell it, even though my mortgage company was happy to lend me the money to buy the house 2 years ago.


As before I am already prepared to sell at X amount, where X is the average on my street over the last 5 years where this will be less than I paid for it originally - but I am going to be astonished if someone (who probably does not even come out to the house) down values it even further, just because they are of the opinion on that day.

The_Palmist

With such low deposit are you taking the help to buy route.

Vendor will understand banks valuation as it is likely to be same for other prospective buyers.

Reduce your offer in line with banks assessment.

Spikecast

The_Palmist wrote: »

With such low deposit are you taking the help to buy route.

Vendor will understand banks valuation as it is likely to be same for other prospective buyers.

Reduce your offer in line with banks assessment.

This. Thinking long term the last thing you want to do is massively overpay and then not seeing the gain in the long run should you decide to sell. Really they've done you a favour in one respect. Lower the offer and tell them why.

rickkelsey

Hello there, I'm making a programme on down valuations for the BBC and saw your post. Could you drop me an email on rick.kelsey@bbc.co.uk. Be great to hear from you.

Rick