Mortgage valuation back and downvalued by 50k... yes 50k

firstbuyer

ACG said:

firstbuyer said:

Deleted_User said:

If you try a new lender then at least it looks like you are trying to find a solution. If that lender also comes back with the same figure then you are in a stronger negotiating position.  

There are only a handful of valuation companies in the country working for all the lenders.  If you have a record of a recent downval at one of those companies then a new buyer is likely to have the same issue (as the valuer will just search internal records) so everyone is more likely to try find a solution

We don't want to apply elsewhere due to ERC fees (we were porting with NatWest) and my husbands credit history - broker suggested NatWest was currently our best option and I'm putting faith in them.

If they ask us to try elsewhere unfortunately my response will be no - which I know sounds bratty haha but I need to stick to my truth on that point.

I do not been this to sound as blunt or as rude as it probably will but...
That sounds like a you problem. 

I would 100% suggest the same as JMA says. Going back and asking for £50k reduction is probably not going to work as you say. You can try and meet in the middle but even £25k is a big drop and the vendor would still likely relist. 

There will be other buyers not wanting to limit themselves to Natwest. Its not their fault you are tied into a deal. 

You either need to suck up the ERCs, find a happy medium or find a new property - I have never had an appeal on property value overturned. You are asking the surveyor to admit they were wrong and the amount of data they have to look at now a days is crazy. 

Thank you for the blunt warning not that it made that an easier read lol

As I said, I understand the buyer isn't going to magically reduce it by 50k, it's a bitter pill to swallow. I also know other buyers will have more options - not doubting that at all.

Having spoken to my broker who has suggested going elsewhere isn't going to be the easier route, and also just being humiliatingly laughed at by the EA I think we'll be finding somewhere else.

We'd pushed hard to get things completed by christmas for the vendor, and had already increased our deposit on this property, it feels like we're now forcing a square into a circle.

ACG

Sorry, I genuinely did not mean it in a harsh way but its like when you rip a plaster off, sometimes it is easier to just say/do it... Blame my mum, she dragged me up to just say it as it is. 

Go back and explain what has happened and why you are pulling out. They might (unlikely) agree to the lower price. But if you just pull out without explaining then they definitely wont be looking at how to make it work. Its that whole "if you do not ask, you do not get" kind of thing. 

But it sounds like it is just one of those things, nobodies fault (apart from the surveyors) it just wasnt meant to be. 

firstbuyer

ACG said:

Sorry, I genuinely did not mean it in a harsh way but its like when you rip a plaster off, sometimes it is easier to just say/do it... Blame my mum, she dragged me up to just say it as it is. 

Go back and explain what has happened and why you are pulling out. They might (unlikely) agree to the lower price. But if you just pull out without explaining then they definitely wont be looking at how to make it work. Its that whole "if you do not ask, you do not get" kind of thing. 

But it sounds like it is just one of those things, nobodies fault (apart from the surveyors) it just wasnt meant to be. 

No that’s fine, the truth definitely hurts!

The EA has said he will speak to them but as they had other offers he will be advising them to remarket. Such is life.

Assuming he will call back tomorrow after speaking with vendor with the news we are expecting anyway.

Is there anything we can do to avoid being stung like this again? I feel like a bit of an idiot at the moment, I’m scared to even look at anywhere else Incase this happens 😂

FrugalCat

firstbuyer said:

ACG said:

Sorry, I genuinely did not mean it in a harsh way but its like when you rip a plaster off, sometimes it is easier to just say/do it... Blame my mum, she dragged me up to just say it as it is. 

Go back and explain what has happened and why you are pulling out. They might (unlikely) agree to the lower price. But if you just pull out without explaining then they definitely wont be looking at how to make it work. Its that whole "if you do not ask, you do not get" kind of thing. 

But it sounds like it is just one of those things, nobodies fault (apart from the surveyors) it just wasnt meant to be. 

No that’s fine, the truth definitely hurts!

The EA has said he will speak to them but as they had other offers he will be advising them to remarket. Such is life.

Assuming he will call back tomorrow after speaking with vendor with the news we are expecting anyway.

Is there anything we can do to avoid being stung like this again? I feel like a bit of an idiot at the moment, I’m scared to even look at anywhere else Incase this happens 😂

The only chance you have to avoid down valuations is to offer less on houses.

I'd look at it this way: The bank's protecting themselves from risk by doing the valuation. They're also protecting you (not that they have your interest at heart, but you're in the same boat).
There's a potential that the valuation is on the low side - but there's also the potential that you were just about to overpay significantly for the house.

I wish people's first response to down valuation would be to assume the latter, rather than assume the former and try to find a lender that is prepared to lend more - then down valuations would be less common in the first place.
And our children might be able to afford houses one day, too.

Jamie_86

Exactly the same thing happened to me. We offered asking price and were accepted on a house at £725k. When the valuation came back from HSBC it was at £675k. We had absolutely no doubt that the house was worth £725k. In fact, we managed to offer on it before it even came to market and I'm 100% certain it would have gone for £750k or more if it had gone on the open market given the experience we've had with other houses in the area going for £50k-£100k over asking price on a couple of others we'd offered on. 

In the end we had to make an application to a different provider anyway because we discovered HSBC didn't accept the professional consutants certificate provided by the developer for the build but clearly there's massive caution out there on valuations at then moment. 

ACG

Its always difficult with valuations. 
We did one at the beginning of the year. The surveyor knocked £100,000 off the valuation. 
The house was in Wilmslow which is basically footballers territory. The surveyor was 100% wrong, it valued up with another lender 4 days later.  You would be unlucky for it to happen twice. 

Thrugelmir

Jamie_86 said:

Exactly the same thing happened to me. We offered asking price and were accepted on a house at £725k. When the valuation came back from HSBC it was at £675k. We had absolutely no doubt that the house was worth £725k. In fact, we managed to offer on it before it even came to market and I'm 100% certain it would have gone for £750k or more if it had gone on the open market given the experience we've had with other houses in the area going for £50k-£100k over asking price on a couple of others we'd offered on. 

In a heated market where there is limited supply. There'll always be people with the financial firepower to pay over the odds. Very different to the lenders approach. Who'll be assessing the market value in a firesale situation. After all it's therir money at risk. When buying with a mortgage it's easy to spend someone elses money without a care in the world. Particularly when the heart rules the head. 

Jamie_86

Thrugelmir said:

Jamie_86 said:

Exactly the same thing happened to me. We offered asking price and were accepted on a house at £725k. When the valuation came back from HSBC it was at £675k. We had absolutely no doubt that the house was worth £725k. In fact, we managed to offer on it before it even came to market and I'm 100% certain it would have gone for £750k or more if it had gone on the open market given the experience we've had with other houses in the area going for £50k-£100k over asking price on a couple of others we'd offered on. 

In a heated market where there is limited supply. There'll always be people with the financial firepower to pay over the odds. Very different to the lenders approach. Who'll be assessing the market value in a firesale situation. After all it's therir money at risk. When buying with a mortgage it's easy to spend someone elses money without a care in the world. Particularly when the heart rules the head. 

Totally understand that and I actually don't blame the surveryors. They're probably right if they look at the value of the property in isolation without taking into account the specific challenges in the local market at that point in time. At the end of the day they're trying to help the bank manage their risk and I completely understand that. 

It just feels excessively undervalued. It will be interesting to see what Coventry BS (who are the second mortgage provider we've now applied to) value it at. 

kingstreet

firstbuyer said:

ACG said:

Sorry, I genuinely did not mean it in a harsh way but its like when you rip a plaster off, sometimes it is easier to just say/do it... Blame my mum, she dragged me up to just say it as it is. 

Go back and explain what has happened and why you are pulling out. They might (unlikely) agree to the lower price. But if you just pull out without explaining then they definitely wont be looking at how to make it work. Its that whole "if you do not ask, you do not get" kind of thing. 

But it sounds like it is just one of those things, nobodies fault (apart from the surveyors) it just wasnt meant to be. 

No that’s fine, the truth definitely hurts!

The EA has said he will speak to them but as they had other offers he will be advising them to remarket. Such is life.

Assuming he will call back tomorrow after speaking with vendor with the news we are expecting anyway.

Is there anything we can do to avoid being stung like this again? I feel like a bit of an idiot at the moment, I’m scared to even look at anywhere else Incase this happens 😂

What about asking if the vendor will give you a reduction equal to your ERC if you apply to a new lender and it's valued up at the agreed price. Shows you are at least willing to stick with it...

firstbuyer

kingstreet said:

firstbuyer said:

ACG said:

Sorry, I genuinely did not mean it in a harsh way but its like when you rip a plaster off, sometimes it is easier to just say/do it... Blame my mum, she dragged me up to just say it as it is. 

Go back and explain what has happened and why you are pulling out. They might (unlikely) agree to the lower price. But if you just pull out without explaining then they definitely wont be looking at how to make it work. Its that whole "if you do not ask, you do not get" kind of thing. 

But it sounds like it is just one of those things, nobodies fault (apart from the surveyors) it just wasnt meant to be. 

No that’s fine, the truth definitely hurts!

The EA has said he will speak to them but as they had other offers he will be advising them to remarket. Such is life.

Assuming he will call back tomorrow after speaking with vendor with the news we are expecting anyway.

Is there anything we can do to avoid being stung like this again? I feel like a bit of an idiot at the moment, I’m scared to even look at anywhere else Incase this happens 😂

What about asking if the vendor will give you a reduction equal to your ERC if you apply to a new lender and it's valued up at the agreed price. Shows you are at least willing to stick with it...

Yeah this could be an option to be fair. The EA still hasn't been able to get in contact with the seller so we're waiting!

We discussed the max we could put in would be another 10k depleting savings but bringing up the offer to 400. I still don't think he will budge but it's an option a least to put to him too.

Will speak to EA about our other options lender wise thanks!