Mortgage offer clarification

[Deleted User]

Hello!

We have just received our mortgage offer from Halifax and in the main features of the loan it has the following:

Value of the property assumed to prepare this information sheet: - value is £35k lower than our accepted offer  
Minimum value of the property required to borrow the illustrated amount - value is £75k lower than our accepted offer

It confirms that the valuation has been done but via market data rather than a psychical valuation.

does the value of the property reflect what they think it’s worth? The mortgage has been offered so I assume they agree with the valuation but we have also 30% deposit so not sure if that impacts any decisions? Just want to ensure we aren’t overpaying for the property 

Thanks for any advice!

K_S

@Deleted_User Based on the info in your post -

- you're right in that Halifax valued the property at 35k less than the agreed purchase price. That by itself doesn't mean a huge lot as valuations are inherently subjective, and another mainstream lender might value it at the purchase price. Also, 35k might be relatively small compared to the price of the property.

- when there is a downval, the LTV is recalculated based on the lender valuation. If the recalculated LTV puts you in a more expensive band then the lender will ask you how you want to proceed, as the specific product applied for will no longer be available.

- in your case it appears that you're still within the original LTV band (60-75% for Halifax) so that's why it went straight to offer.

- You started at 70% LTV, and even with the downvaluation your LTV is less than 75%, so it makes no difference to the LTV band.

[Deleted User]

Hi @K_S

thanks that’s super clear! The amount is about 8% of the value however the property has been done up to a really high standard which probably wouldn’t be reflected in the valuation

As we have the mortgage approved unsure if we should try and meet the seller in the middle or not - we will also get a surveyor in so hopefully they will be able to validate the price slightly more as they will visit the propert