Undervalued New Build 10k TWICE!!

Gideon763

Hi there, I'm buying a 1 bedroom flat with my partner with Taylor Wimpey and we've had the property undervalued TWICE by independent surveyors. We just received the news from the broker this evening that the second lender's valuation came back the same as the first - 10k under. This means we can't take advantage of the government Help To Buy loan as they will only lend if the purchase price meets the valuation.

We don't want to forego the property because it's perfect for our requirements and it meets our needs. In all honesty, its a better size and price than some others we were looking at on the market.

I've read some threads on here about people who have managed to convince the developer to reduce the price. I feel like we are in a strong position having been undervalued twice after they essentially promised it would not happen again. But because they have sold all the 1 bed flats for this phase I am scared they will say no.

Its important to note that the property will be due for completion the end of this year, and we reserved very early. So it's only on the first phase and with 10 months to go until completion.

I have not spoken to the developer since I just found out from the broker that the second valuation came out under. And we do not want to do apply for a third time as we fear it will happen once more.

Any advice would be appreciated, we really want this property and in an ideal situation they will reduce the price by 10k. Thanks!

AdrianC

They've sold all the other 1-beds... and yours is the only one to be undervalued?
Or you agreed a price £10k more than all the others?

middleclassbutpoor

All you can do is present the case to them.

Did you have to use their mortgage broker or did you use someone not connected?

If you used someone connected, they may need to explain that this is now not a case of a fussy lender etc.

At the end of the day, the valuer acts for the lender not you but in doing that, they do protect you because if they are saying the flat is not sufficient for security on the money being lent then you should be pleased someone is stopping you from spending more money on it that you should.

Gideon763

middleclassbutpoor wrote: »

All you can do is present the case to them.

Did you have to use their mortgage broker or did you use someone not connected?

If you used someone connected, they may need to explain that this is now not a case of a fussy lender etc.

At the end of the day, the valuer acts for the lender not you but in doing that, they do protect you because if they are saying the flat is not sufficient for security on the money being lent then you should be pleased someone is stopping you from spending more money on it that you should.

After the first valuation come in under, they said it's the first time its happened for them. And they essentially guaranteed it would not happen again.

The broker also said something along the lines of "1 surveyor did it under when the other 29 out of 30 would get it right" or something.

Fuming

Gideon763

middleclassbutpoor wrote: »

All you can do is present the case to them.

Did you have to use their mortgage broker or did you use someone not connected?

If you used someone connected, they may need to explain that this is now not a case of a fussy lender etc.

At the end of the day, the valuer acts for the lender not you but in doing that, they do protect you because if they are saying the flat is not sufficient for security on the money being lent then you should be pleased someone is stopping you from spending more money on it that you should.

My girlfriend's uncle is representing us as a solicitor and he's a partner at a Conveyancing firm. He said the developer has been IGNORING him after he's received instruction from Natwest (first lender) to proceed.

We used the developer's recommended broker as they didn't charge fees. They have been helpful to be fair, and I believe this is out of their control. It's a matter of random independent surveyors valuing this property under and yes it's to our benefit. But we also want this property.

I will be relaying the news to solicitor tonight that both lenders came in under and see if he knows the best way to get them to budge.

middleclassbutpoor

Your solicitor isn't probably the best person to be engaging at this stage.

Go back to your broker and ask them to sort it. You have used them for this reason in terms of giving you the best chance to buy the property should anything like this happen.

As you have followed their advice and complied with their request to go somewhere else, you now believe that they should resolve this without further cost, time or inconvenience to yourself.

The broker should be challenging the valuation by supplying evidence of previous sales etc. Not just sending you to more lenders hoping to 'get lucky' with a surveyor. May be worth asking a broker on the mortgage board, what they would do if their client was in your position - that will give you a good idea of whether your broker is looking after you or the builder.

Gideon763

middleclassbutpoor wrote: »

Your solicitor isn't probably the best person to be engaging at this stage.

Go back to your broker and ask them to sort it. You have used them for this reason in terms of giving you the best chance to buy the property should anything like this happen.

As you have followed their advice and complied with their request to go somewhere else, you now believe that they should resolve this without further cost, time or inconvenience to yourself.

The broker should be challenging the valuation by supplying evidence of previous sales etc. Not just sending you to more lenders hoping to 'get lucky' with a surveyor. May be worth asking a broker on the mortgage board, what they would do if their client was in your position - that will give you a good idea of whether your broker is looking after you or the builder.

Thank you, appreciate this advice. They have advised me this evening to speak to the developer directly though?! But I completely agree, it's in their interest to get us the property so they can get paid.

At the moment me and my partner feel completely overwhelmed with the stress of all of this and we've done nothing wrong.

I will advise them to challenge the valuation and explain we will not be using another lender in the hopes of 'getting lucky' as you mentioned. And if not, reduce the price of the property .

middleclassbutpoor

You could relay this message also to the sales office and ask them to speak to the Adviser and come back to you when they have come up with a plan/solution.

You need to ensure you are assertive with them at the appropriate times. If they start washing their hands of you - I would be prepared to get your deposit/reservation fee back and start again and put it down to it wasn't meant to be.

Gideon763

middleclassbutpoor wrote: »

You could relay this message also to the sales office and ask them to speak to the Adviser and come back to you when they have come up with a plan/solution.

You need to ensure you are assertive with them at the appropriate times. If they start washing their hands of you - I would be prepared to get your deposit/reservation fee back and start again and put it down to it wasn't meant to be.

I completely agree, should I ask the broker I've been dealing with to take it up to the high management and demand they come back to me with a solution? (Explaining of course we refuse to use another lender)

eddddy

Something to consider...

There are just 4 valuation firms who do valuations for for most of the mortgage lenders - they are Connells, Colleys, Countrywide and esurv.

So it's quite possible that it was the same firm that valued the property both times, for the 2 different lenders. (And they would automatically give it the same valuation both times.)


Although TBH, a good mortgage broker should know this, and advise you against applying to 2 lenders who use the same valuation firm.

Gideon763

eddddy wrote: »

Something to consider...

There are just 4 valuation firms who do valuations for for most of the mortgage lenders - they are Connells, Colleys, Countrywide and esurv.

So it's quite possible that it was the same firm that valued the property both times, for the 2 different lenders. (And they would automatically give it the same valuation both times.)


Although TBH, a good mortgage broker should know this, and advise you against applying to 2 lenders who use the same valuation firm.

Thanks for the heads up. I am sure because of the awareness of the issue, they would have used a new lender with a different surveyor. But yeah, either way its still incredibly frustrating.