Property valued lower than offer price

JamieFa

Hello 

In January I put an offer on a property as a FTB. Property was listed for 300k after doing bit of research and asking friends and family we thought it was a fair price for the property in that area. 

So I put in an offer for the asking price of 300k and my offer was accepted. Had our valuation carried out and property was valued for 290k. 

Seller is looking to buy another property and waiting for his valuation before he can bring his asking price down.

My questions really are
1. How long will my bank wait as his valuation is booked for next week? 

2. What are my options if he doesn't want to sell it for less than the asking price?
3. How often this happens where valuation comes back under the offer price? 

Thanks in advance!

K_S

@JamieFa

1. Assuming the lender has issued an offer for the lower amount, it's usually valid for 6 months.

2. Make up the difference in cash, try another lender (might not help as it might just be the same valuer or there's not enough information to justify a higher price).

IAMIAM

`This is just the norm at minute. Every valuation I know of is coming back under offer price. 

hellomoto123

Ours was valued 50k under. We walked away last week sadly, but found a better property in Saturday 

Good luck

JamieFa

@K_S

Thank you for posting back! 

I have not received my mortgage offer yet. My broker has asked me to speak to the seller and see if he can come any lower but he(broker) is also pushing it by saying we only have 14 days to decide and get the mortgage offer. 

Is it really 14 days?

K_S

@jamiefa the 14-day "deadline" doesn't really make any significant difference. You can always get an offer issued with the assumption that you will make up the difference. And then if the seller later accepts a lower price, just get the offer reissued for the lower price. Happens all the time when the buyer and seller agree a price reduction post-offer due to things that came up later like a roof that needs repair, etc.

It all depends on what you want to (and can) do with regard to the difference. As far as the lender is concerned, their valuation is what it is, there's no changing that.

RelievedSheff

Can you not swallow the difference and move into a different LTV bracket?

RelievedSheff

IAMIAM said:

`This is just the norm at minute. Every valuation I know of is coming back under offer price. 

I dont think this is strictly true. Ours came back higher than we had thought for our remortgage application.

Irishpearce26

JamieFa said:

@K_S

Thank you for posting back! 

I have not received my mortgage offer yet. My broker has asked me to speak to the seller and see if he can come any lower but he(broker) is also pushing it by saying we only have 14 days to decide and get the mortgage offer. 

Is it really 14 days?

The 14 days is the deadline to complete the application which determines which interest rate product you will get. If you go passed the 14 days it will be a new application and product. The broker is understandably trying to save time and effort. If the mortgage valuation has come in lower than what you are going tp pay it wont matter what the sellers valuation on the property he is buying as the lender will decline the mortgage unless you plan to make up the difference or go into a higher LTV.