Home buyer survey results

NewHomeBuyer93

Hi
Me and my parter are first time buyers so I was wondering if someone is able to advise me on this situation. We made an offer £10k above the asking price for a property we liked and our mortgage lender approved it. However after conducting a home buyer survey and valuation is stated the property was over valued for what it’s worth in the market and should be £20k lower of what we have offered.

They have advised that there is the odd cracks to boundary walls as well as hairline cracks to celilings and window heads. As well as mould to some ceiling and corrosion to a radiator. The way the garage is built doesn’t follow building regulation either.
I don’t have a lot of experience in home repairs, are these problems of concern or should I accept this.
Also wondering if I send this to my conveyancers would it cause any problems with my mortgage? Would my lender now refuse this house with the new valuation figure? Or can my solicitors use this information to negotiate the figure a little? Would my conveyancers have to disclose this information to my lender?
Any advise would be appreciated. Thank you

SmashedAvacado

There are two issues here:

1. Their general view on the value of the property
2. Some minor works that need doing

I suspect your valuation fails because you have offered more than the valuer is prepared to value at even if you disreagrd the minor works (or insurances you might need to cover building regs etc). You may struggle to overcome this with your seller - can the agent help inform the valuer that the valuation is too low

On the works themselves, you need to look at the cost of anything needing doing right now / not visible from your viewing - was that £5ks worth? That's probably fair game for a price reduction.

But unless you can get £20k off your deal fails. Or you find another lender who hopefully uses another valuer and when that valuer picks up the keys from the agent, you get the agent to show the valuer sold property details that explain why what you are paying is reasonable.

Caz3121

your mortgage LTV will be based on the lower of the offer price or the valuation.
the lender will reassess the offer based on the valuation
Do you have an extra £20k to put in?
Alternatively you could negotiate with the sellers to reduce your offer

NewHomeBuyer93

We don’t really have another 20k to our towards the house as yhe deposit we had gathered was from savings.
As our mortgage provider carried out a valuation on the property before accepting our mortgage offer we assumed it was the correct value
After the searches were carried out our sols mentioned a home buyer survey which was what I had requested, however the independent surveyor included the valuation otherwise we probably wouldn’t have known.

I don’t think the work that needs doing is anything urgent.
However it mention horizontal cracks on the wall and vertical cracks on the boundary wall which I was concerned about. There is also polystyrene ceiling and a opening pvcu window which are fire hazards.

letitbe90

If you had just booked a valuation by the lender (and not a survey), there is a very high chance that the valuation was calculated in some office automatically with software (which bases valuation around data for a given postcode, nearby sold prices, assumed index growth rate etc). These can be very accurate but also wildly inaccurate depending on the house/street. They can't pick up on things like major disrepair that exists or major improvements made to a house including potential extensions.

NewHomeBuyer93

Yes from the searches I got my solicitors did say that my mortgage providers might have done a desktop valuation.

If I sent my new home buyer report and valuation to my solicitors would they have to report back to my lenders about the valuation being lower?

Chi-me

So your saying you had the valuation done for mortgage purposes and mortgage agreed, then homebuyers survey disagreed with that?

We recently had a mortgage valuation done and mortgage agreed on that basis. We then had a private homebuyers survey undertaken which picked up some (expected) issues. The private survey didnt undertake a valuation, they noted that it was not requested. Our mortgage provider wont see this survey.

Did you request a 2nd valuation during the 2nd survey then? Or have I had a brain fart? Possibly the latter

NewHomeBuyer93

Yes our mortgage provider carried out a valuation before they approved our mortgage and offer. They accepted the price we offered which was £10k above the asking price.

For our own peace of mind I requested a home buyer report however the surveyor also included a valuation and the new valuation much lower.
It included some stuff which my solicitors need to check with vendor. However I’m thinking of excluding the valuation part.

Albala

I think I'd ask my solicitor what I had to tell the lender. And I think I might just get a builder to look at the cracks. They might well turn out to be nothing much at all, which would help your peace of mind, or worrying, in which case you need to know.