Huge down-valuation from lender but Home Buyers is agreed price!?

pack_horse

My partner and I are FTBs in stable jobs, buying a house well within our means (repayments are close to our current rent) in another part of the country. The lender was initially funny about the relocation, but we got paperwork from our employers to put there mind at ease. The agreed price on the house is ~10k lower than the asking, and the Home Buyers survey agreed with that.

Now the lender's valuation has come back 15% (!!) lower than the agreed price. The broker says to contact the agents but that feels like it's going to spook the horses. I'd rather just ditch the lender and go with another as it seems unlikely they'd value similarly? The broker has needed nudging every step of the way and it feels like blood out of a stone, I'm half mind to ditch them as well and go it alone!

Any advice welcome!

vi009na

pack_horse said:

My partner and I are FTBs in stable jobs, buying a house well within our means (repayments are close to our current rent) in another part of the country. The lender was initially funny about the relocation, but we got paperwork from our employers to put there mind at ease. The agreed price on the house is ~10k lower than the asking, and the Home Buyers survey agreed with that.

Now the lender's valuation has come back 15% (!!) lower than the agreed price. The broker says to contact the agents but that feels like it's going to spook the horses. I'd rather just ditch the lender and go with another as it seems unlikely they'd value similarly? The broker has needed nudging every step of the way and it feels like blood out of a stone, I'm half mind to ditch them as well and go it alone!

Any advice welcome!

Who was the lender, high street bank? 

london21

pack_horse said:

My partner and I are FTBs in stable jobs, buying a house well within our means (repayments are close to our current rent) in another part of the country. The lender was initially funny about the relocation, but we got paperwork from our employers to put there mind at ease. The agreed price on the house is ~10k lower than the asking, and the Home Buyers survey agreed with that.

Now the lender's valuation has come back 15% (!!) lower than the agreed price. The broker says to contact the agents but that feels like it's going to spook the horses. I'd rather just ditch the lender and go with another as it seems unlikely they'd value similarly? The broker has needed nudging every step of the way and it feels like blood out of a stone, I'm half mind to ditch them as well and go it alone!

Any advice welcome!

Personally I will use the down valuation to re-negotate with the vendor.
If you do not ask then you never know if they would have agreed. 

pack_horse

Bank of Ireland... I guess they qualify as that right?

vi009na

london21 said:

pack_horse said:

My partner and I are FTBs in stable jobs, buying a house well within our means (repayments are close to our current rent) in another part of the country. The lender was initially funny about the relocation, but we got paperwork from our employers to put there mind at ease. The agreed price on the house is ~10k lower than the asking, and the Home Buyers survey agreed with that.

Now the lender's valuation has come back 15% (!!) lower than the agreed price. The broker says to contact the agents but that feels like it's going to spook the horses. I'd rather just ditch the lender and go with another as it seems unlikely they'd value similarly? The broker has needed nudging every step of the way and it feels like blood out of a stone, I'm half mind to ditch them as well and go it alone!

Any advice welcome!

Personally I will use the down valuation to re-negotate with the vendor.
If you do not ask then you never know if they would have agreed. 

Thats true, but sometimes bank just do down valuation. 
In my case HSBC did AVM valuation which resulted in down valuation by 10%. In my area house prices are climbing like anything and next door house got asking price valuation by high street bank. I knew seller will not sell his house for that price and even I am aware of market so applied with NatWest now who is going to do physical valuation on 29th. Will update result here.

So OP needs to find out what kind of valuation BOI did.

vi009na

pack_horse said:

Bank of Ireland... I guess they qualify as that right?

If your case is simple with fixed regular income with good credit history, you can go directly for speedier process. 
However I saw some deals are with brokers only and not directly with banks and hence I opted for Habito online broker who had the deal I wanted. 

K_S

pack_horse said:

My partner and I are FTBs in stable jobs, buying a house well within our means (repayments are close to our current rent) in another part of the country. The lender was initially funny about the relocation, but we got paperwork from our employers to put there mind at ease. The agreed price on the house is ~10k lower than the asking, and the Home Buyers survey agreed with that.

Now the lender's valuation has come back 15% (!!) lower than the agreed price. The broker says to contact the agents but that feels like it's going to spook the horses. I'd rather just ditch the lender and go with another as it seems unlikely they'd value similarly? The broker has needed nudging every step of the way and it feels like blood out of a stone, I'm half mind to ditch them as well and go it alone!

Any advice welcome!

@pack_horse Try renegotiating with the vendor.

If that doesn't work then if you still want the property you can either appeal the downvaluation (it'll be a tough ask to overturn a 15% downval) or as you said go for another lender that does not use the same panel of surveyors (it's hard to "guarantee" this though) and hope it returns a different result. Good luck!

pack_horse

Thanks @vi009na and @K_S, very helpful. As FTBs my worry is that the agents will freak out if we look to renegotiate such a huge amount (and properties in the area are consistently selling for around the agreed price) and they may advise the vendors to pull out. I'd much rather try with another lender to see if at the very least this massive downval can be made smaller as a first step.

Good luck @vi009na with your valuation!