Down valuation - to pay or not to pay the difference...

reecesteph · 2 May 2018 at 10:01AM

Hi everyone,

We're first time buyers and had our offer of £660k accepted on a property in North East London. We've just received news that our bank valued it at £625k. The reason we're able to afford this property is through inheritance and we'd be able to cover the £35k difference and it would not affect our mortgage significantly.

Our concern is putting in £35k extra in a market which is looking more likely to go down than up and we realise we're very blessed to have a large deposit, but also very aware that is certainly not the case for everyone (including future buyers of our property). So if the market falls 10% int the next few years we'd be down £66k+£35k potentially.

We're thinking our current options are:

Walk away
Challenge the valuation (which is unlikely to go anywhere and not needed from a financial point of view)
Get our own valuation (and our own piece of mind)
Negotiate a discount in price with the seller based on valuation from bank and possibly our own valuation

If anyone has advice or has been in a similar situation we'd love to hear your recommendations.

Many thanks,

Reece

alan_d · 2 May 2018 at 10:28AM

Personally i'd go with 'Negotiate a discount in price with the seller based on valuation from bank and possibly our own valuation' - and if they won't budge, walk away. They will probably hit the same issue with the next buyer, and have no choice but to accept a lower offer, eventually.