Down valuation - what next?

[Deleted User]

I’ve found out today that the lender for my buyers has down valued my property and hence rejected their application.

My EA is insisting we continue with the current buyers and allow them time to apply again with another lender. They appear to be hopeful that we will achieve the desired valuation next time around. However I am not convinced…

I was already prepared to re-market as I had lost patience with them already (as they have already taken 3 months getting to this stage) so I think it’s best I go ahead and re-market? 

If the current buyers manage to get a mortgage great, 
If a new buyer comes along then also great! 

I’m just a bit unsure as to why my EA would be against re-marketing? 

MaryNB

Costs them more money in time spent organising and holding viewings, vetting buyers, negotating etc. Might be more beneficial for them to get a slightly smaller commission (by convincing you to drop the asking) than go through the process of finding a new buyer. 

Go ahead and remarket. It shouldn't have taken the buyer 3 months to get to this point. They must have been having other difficulties or maybe already had a failed application before and this was attempt number 2. 
Desktop valuation I presume based on your previous thread?

[Deleted User]

Yep. Thanks for your advice. Massive set back, and we’ve also been advised our sellers will need to be made aware (fair of course) so I am now concerned that they may also remarket.

Thrugelmir

Did your buyers offer above asking price for the property? 

Thrugelmir

Deleted User said:

Thrugelmir said:

Did your buyers offer above asking price for the property? 

Nope, sold at the asking price. 

Just realised you've another thread running. Best to stick to one. 

lookstraightahead

The next valuation will likely be the same, so if you want the same amount you will need a buyer who has spare cash to make up the shortfall.

Gentoo365

Or drop the price

hazyjo

lookstraightahead said:

The next valuation will likely be the same, so if you want the same amount you will need a buyer who has spare cash to make up the shortfall.

Exactly. It's unlikely they actually rejected it (unless there's a major prob and they gave it a zero valuation), more likely the buyers didn't want to, or couldn't, make up the shortfall.

How much under is it? What percentage?

[Deleted User]

Gentoo365 said:

Or drop the price

It’s not an option without backing out of our onward purchase. 

hazyjo said:

lookstraightahead said:

The next valuation will likely be the same, so if you want the same amount you will need a buyer who has spare cash to make up the shortfall.

Exactly. It's unlikely they actually rejected it (unless there's a major prob and they gave it a zero valuation), more likely the buyers didn't want to, or couldn't, make up the shortfall.

How much under is it? What percentage?

It’s 5%

lookstraightahead

The problem you have with your onward move will be the same as your purchasers are probs oh having - can't make up the shortfall. 

Are you sure your buyers can't get a mortgage at all, or is it just that they can only get a mortgage with regards to the actual valuation? 

If the latter, could you negotiate a reduction on your onwards purchase.

I know this isn't helpful at this stage  but this seems to be happening a lot. People panic buy because of the current climate and then can't get their multiples. Has the house you're buying been valued and are you paying over asking/valuation? 

Flugelhorn

frustrating as has taken quite a bit of time but unfortunately suspect it might happen in few of the extant chains where perhaps people did panic buy and it isn't quite working out