Santander offer my mortgage then withdrew because of down valuation

CJM30

Hi,

Im currently in shock and want to know if anyone has also experienced this. Im a first time buyer on a shared ownership property. My broker applied for my mortgage with Santander, the valuator went out last Tuesday 4th December, on Friday 7th December my mortgage was offered, on Monday i received a email stating my offer was on its way to me then within 1 hour my broker contacted to say they had down valued the property by 40k!!! so now the original offer wasn't valid.... How can they do this? They must of had he valuation before they offered Friday. Im now in limbo with what to do and my broker is looking at other lenders. Has anyone experienced this? Because this is a shared ownership property the sellers do not have the authority to reduce the price even if they wanted to, as the price sits with the housing association. This is a resale on a 2 year old property.

haras_nosirrah

I had this once before with santander. In my clients case they only picked it up after exchange and when they were releasing funds but after a massive hoo Haa we got them to honour the original offer.

The brokers don't see the valuation so he wouldn't have known. A 40k downvaluation though is massive. What is the price of the property?

aungnaingcho

My situation is like yours as well. I made a application with Santander in 03 Dec 2018. It took them almost 4 weeks to decide on the application.

I receive my mortgage offer being issued text message from them and was so happy. but when I receive my offer letter there was a clause put in there stating the mortgage will be only release if the lease is to extend to 99 years.

They knew the flat has only 85 years lease when i made the application but why not decline the application at the first place rather than wasting 4 weeks of my time and stress. Now I seems to have to start all over again with a different lender which is going to give me all those stress I went through with Santander 4 weeks ago.

They have valued the flat at the same price as I have offered. Mine is not Shared ownership flat but lease is only 85 years left.

I am FTB and my mortgage adviser is suggesting I change the lender and make the fresh application again.

Any idea on how to proceed with the purchase? what have you done with yours as well?

Lbrik

I am having a similar concern, although I haven’t applied for a mortgage yet. I’m interested in a one-bed flat that is priced at £440k in zone 1 London, with very attractive monthly payments. But when I searching newly-built homes in the same area, I see that similar properties cost £375-390k max, which is a huge difference from the quoted price. So this is probably why the financial advisers allocated to the sale are saying “not all lenders will lend to shared ownership”. I can well imagine how e.g. Santander would do a similar valuation and would immediately see that the property is overpriced. And this to me seems to be a common feature of SO - they have affordable monthly cost, but an inflated original price, to make sure the govt and HA don’t lose a penny - a so-called built-in insurance at buyer’s cost??