Remortgage and stupid valuation report.

Gambler

stillill wrote: »

Negotiate down below 200k. Or have +50k cash on top of the mortgage.

If it's valued at 200k now, think what it'll be valued at in 2 or 3 years and start there I would suggest. If you're going to live in it for 5-10 years it's not so bad.

Or if you really really like it and they won't take less than 250k, realise that you're overpaying by a massive amount for an asset with a value that is plummeting.

We have been looking at loads of properties around the £250K and we felt this was the best one we had seen and totally fell in love with it. We offered full asking price as the there was huge interest and we didn't want anybody else getting through the door.

I expected it to be less, maybe £230K but this difference is huge.

Commonsensesearcher

Gambler wrote: »

The valuation has come back at £200K..................help

You see, unless the surveyor/valuer from the mortgage company is a complete muppet, he won't be falling 'in love' with any property on walking through the door. However, as he will more than likely be working for a lender who is interested more in profit than your dreams of happyness in the said property, then he will be looking to reduce the risk that the lender has in connection to your mortgage hence the low valuation.

If he values it at £200k then revise your offer to £200k - and as this will be happening all over la la land UK you might just find you will get the £200k accepted - might not be immediate but it will more than likely happen...

Guy_Montag

Gambler wrote: »

We have been looking at loads of properties around the £250K and we felt this was the best one we had seen and totally fell in love with it. We offered full asking price as the there was huge interest and we didn't want anybody else getting through the door.

I expected it to be less, maybe £230K but this difference is huge.

Without wishing to sound like too much of a !!!!, it wasn't yours to fall in love with. Now you have to decide if you want to pay 20% over the odds for the biggest purchase you'll ever make. Or put another way - how long will it take you to earn £100k (50k paid off over 25 years).

So ask yourself this:
1) Is it unique - I mean something really special: if it's a new-build on an estate, probably not. If it's a 15c farmhouse with oak beams with views over the Cotswolds, well maybe it is. Most are somewhere in between.
2) Are you going to stay there for the rest of your lives (or near enough)

If you can answer those positively it may be worth going for, otherwise...

Gambler

Guy_Montag wrote: »

Without wishing to sound like too much of a !!!!, it wasn't yours to fall in love with. Now you have to decide if you want to pay 20% over the odds for the biggest purchase you'll ever make. Or put another way - how long will it take you to earn £100k (50k paid off over 25 years).

Just to clarify it doesn't really affect the mortgage I need apart from my LTV going from 50% to 70%.

Guy_Montag wrote: »

1) Is it unique - I mean something really special: if it's a new-build on an estate, probably not. If it's a 15c farmhouse with oak beams with views over the Cotswolds, well maybe it is. Most are somewhere in between.

We live in the new build on an estate now and hate it. It's a 5 bedroom end terrace cottage totally rennovated in a semi rural village with huge space and a huge garden. It is a unique property and I certainly feel this is one part where the surveyor would struggle to compare property prices in the area is there are no properties like this. It sold for £168K in Oct-06 and has easily had £80K spent on it which is they way I looked at it when making the offer.

Guy_Montag wrote: »

2) Are you going to stay there for the rest of your lives (or near enough)

I'd say 10 years +


The biggest problem I have at the moment is the £50K difference !!

homer_j_3

I would go back to the EA and tell them that its not worth £250k and anybody getting a valuation on it will get the same information back. Tell them that you are putting a large deposit down and therefore are not some FTB who is chancing a 95%-100% mortgage.

You are a strong candidate to buy this house, the only thing stopping it coming down to 200k will be the fact that the current owners look like they will be taking a hit.

I think by going back and presenting the information, without actually saying what you want, you will see if there is any movement. So...

pick up the phone and say "Had the Homebuyers report and that the valuation has come back with £200K. If the surveyor has identified problems, explain what these are (because EA's value on being in good order with no adverse problems affecting value). Explain that you are worried about the market not being bouyant and at this stage are not sure what to do. Ask them if they can take this information, on the basis that you presume every other surveyor out there will value the same and see what their clients want to do. Leave it at that and do not say that you do not want it or that you do.

Ask when it is likely that they can come back to you. Then wait and see what happens. You wont be the first or last to have the valuation like this. If there is no way they can shift because of negative equity then you need to go into it with eyes open wide - however, do not let them know that you are prepared to do this!

ThriftyBeanie

The house sold for £168k in Oct 06 - in a buoyant market. Could well be that the then buyer paid a premium for it, maybe it was valued at (say) £150k at that time.

Then £80k of refurbs have been made. Depends on the nature of those refurbs, but if they have ripped out existing kitchen, bathrooms, bedrooms, windows etc (as opposed to adding new space) then that £80k might only have added £40k of value.

All hypothesis but starts to make the £200k valuation look quite reasonable perhaps.

If you are still set on the house I think Homer's strategy is spot on.

Gambler

homer_j wrote: »

I would go back to the EA and tell them that its not worth £250k and anybody getting a valuation on it will get the same information back. Tell them that you are putting a large deposit down and therefore are not some FTB who is chancing a 95%-100% mortgage.

You are a strong candidate to buy this house, the only thing stopping it coming down to 200k will be the fact that the current owners look like they will be taking a hit.

I think by going back and presenting the information, without actually saying what you want, you will see if there is any movement. So...

pick up the phone and say "Had the Homebuyers report and that the valuation has come back with £200K. If the surveyor has identified problems, explain what these are (because EA's value on being in good order with no adverse problems affecting value). Explain that you are worried about the market not being bouyant and at this stage are not sure what to do. Ask them if they can take this information, on the basis that you presume every other surveyor out there will value the same and see what their clients want to do. Leave it at that and do not say that you do not want it or that you do.

Ask when it is likely that they can come back to you. Then wait and see what happens. You wont be the first or last to have the valuation like this. If there is no way they can shift because of negative equity then you need to go into it with eyes open wide - however, do not let them know that you are prepared to do this!

Excellent post. Many thanks for the advice.

macfarlan

toonfish wrote: »

this is inevitable in today's market but it sad so see the HPC'ers gloating at other's misfortune.

Says more about them than it does about estate agents or mortgage brokers.

I am a mortgage adviser

That's really funny.

Datasafe_2

ThriftyBeanie wrote: »

The house sold for £168k in Oct 06 - in a buoyant market. Could well be that the then buyer paid a premium for it, maybe it was valued at (say) £150k at that time.

Then £80k of refurbs have been made. Depends on the nature of those refurbs, but if they have ripped out existing kitchen, bathrooms, bedrooms, windows etc (as opposed to adding new space) then that £80k might only have added £40k of value.

I think that is spot on.

Gambler

homer_j wrote: »

Ask when it is likely that they can come back to you. Then wait and see what happens. You wont be the first or last to have the valuation like this.

Anybody else experienced a 20% difference?