Apply mortgage first? or re-negotiate price first?

917700

Hi all

Long story in short. I am considering to re-negotiate the agreed price on a property. Is there any difference between applying for a mortgage first or negotiating a new price first? I wish to apply the mortgage as soon as possible, but the mortgage broker suggested to get an new agreed price first. 

The independent building survey was done in the end of November and the report just came back to me a few days ago. The estimated cost for the building works will be £20,000, but the major works were visible during the viewing. The mortgage broker suggested this property is very likely to be down valued by the lender.

So I am thinking, the vendor probably won't accept reduced price unless the lender valuation is lower than the agreed price. Any suggestions please?

Thrugelmir

If the vendor isn't going to accept your revised offer then applying for a mortgage now is pointless. 

917700

Thrugelmir said:

If the vendor isn't going to accept your revised offer then applying for a mortgage now is pointless. 

Hi Thrugelmir

After the building survey, I told the estate agent that the surveyor verbally flagged some issues. Then they replied 'I’m not sure whether the owner has much room for movement in the agreed price, but if there are any substantial works required, we can certainly discuss and see what options may be available to keep things moving forward.'

I am also thinking another scenario. We archive a new agreed price now, but the lender's valuation is still lower than the new agreed price. Will the vendor feel annoyed if I ask further price reduction? 

BJV

Buying or selling property is always a negotiation and even then there is never any guarantee that you and the vendor will be able to agree. If the main work was visible when you viewed they may think that the price reflects this? TBH I would talk to the vendor first. If they are not happy to move then the is zero point sorting out the mortgage. Then once and if that is agreed you can sort the mortgage out. If your mortgage offer is still lower then that is another conversation. 

917700

BJV said:

Buying or selling property is always a negotiation and even then there is never any guarantee that you and the vendor will be able to agree. If the main work was visible when you viewed they may think that the price reflects this? TBH I would talk to the vendor first. If they are not happy to move then the is zero point sorting out the mortgage. Then once and if that is agreed you can sort the mortgage out. If your mortgage offer is still lower then that is another conversation. 

Thanks BJV

Is this a common thing to re negotiate twice? This is my biggest concern. 

The internal decoration is below the average condition, and I did put this into consideration when I put my offer. The main building work include New roof, Rewire, Re point brickwork, New wall ties and New external doors. Yes, they were visible, but I didn't realize this level of works need to be done.  

MFWannabe

You’re over thinking it; negotiate the price first and take it from there 

917700

MFWannabe said:

You’re over thinking it; negotiate the price first and take it from there 

Thanks for your advice. 

MWT

Keep it simple, now you know the cost of the works are you still happy to pay the agreed price?

If not then it doesn't matter what the lenders valuation says you should renegotiate the price now.

If you don't and the lender's valuation comes in at the agreed price you will have cut of your own support for the renegotiation...