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Surveryor's Report estimated the cost of the property less than my offer


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Hi All

 

I put in an offer in a terraced house in Plaistow, London for £346K.  This was accepted by the seller.  The survey has been done by the mortgage company who estimate the cost of the property to be only £330K.  What can I do about this lower value?  I would obviously prefer to pay the lower value.  Can the seller insist that I pay what I offered?

 

thanks in advance

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Hi Yvonne,

 

I've had this happen to me with a buyer when I was a seller, so I can answer from that POV.

 

It's a negotiation point, you can go to them and lower your offer based on the mortgage valuation - or you can add more of your own money to match the sellers asking price, or meet in the middle.

 

You're not bound to any deal until you exchange contracts.

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Like Darren said, it's a great negotiation point!

 

You'll know from your own research whether you think the valuer is accurate with the lower figure or not. If you're convinced that it's genuinely worth £346k then you can (grudgingly, eventually) meet somewhere in the middle and get yourself a nice discount. Or if you believe the valuer to be correct, then it's very easy for you to insist on that price or walk away.

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A client of mine looking for a refurbishment property offered £410k. The delightful valuer came in at £374k. The vendor split the difference so client saved £18k after paying £750 for a valuation. He is happy as after works valuation was confirmed by valuer.That's the positive side of a down valuation and quite often the vendor just tells you where to go.

 

Reducing the price depends on the vendor's situation and how much their value is influenced by the Mail and also Standard, Expectations from vendors can be on the high side. It's less than 5% so an appeal won't get you anywhere.

 

Negotiate and you may get lucky especially as the valuation figure will now be on the database for other valuers to see!

Regards Simon

Searchlight Finance Ltd

T:01565 654005

 

Landlord and specialist property finance advisor only dealing with investors, landlords and developers throughout the UK and beyond.

Buy to Let - Commercial Finance - Bridging Loans - Development Finance - HMO Finance - Refurbishment Loans - Multi Let - Limited Company - Student Lets - Portfolio Finance

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  • 2 weeks later...

Hi All

 

thanks for your advice.  After some negotiation the vendor has agreed on a price of £332,500.  so £2.5k above the valuer price.  so I'm happy with that bit of negotiation as I've saved £13.5K

 

Thanks again.

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I had this problem when re-mortgaging. The surveyor put my house at a value under what similar houses on my road were going for that I wasn't able to get the LTV I was hoping for. Meant that I had to go for a different product and fork out for another survey!

 

Does anyone know how to avoid this?

 

Thanks

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I had this problem when re-mortgaging. The surveyor put my house at a value under what similar houses on my road were going for that I wasn't able to get the LTV I was hoping for. Meant that I had to go for a different product and fork out for another survey!

 

Does anyone know how to avoid this?

 

Thanks

Look for comparables that have sold within the last three months. Being on the market doesn't count. If a purchase easier to talk to local agents about properties that have sold recently that are not on land registry and advise the valuer. If you have added value tell he valuer what has been done and at what cost although it can be luck of the draw.

Regards Simon

Searchlight Finance Ltd

T:01565 654005

 

Landlord and specialist property finance advisor only dealing with investors, landlords and developers throughout the UK and beyond.

Buy to Let - Commercial Finance - Bridging Loans - Development Finance - HMO Finance - Refurbishment Loans - Multi Let - Limited Company - Student Lets - Portfolio Finance

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until I read this post based on a deal I had heard of which fell apart becuase of this, I assumed that when the lenders valuer values < price agreed between vendor and prospective purchaser, that this would mean the lender would not lend at all. Am I correct in thinking now that all it means is the lender will only lend based on the valuers value, ie if 75%LTV, they will lend 75% of the valuers value, not the price agreed and paid between the vendor and prospective purchaser, ie result is buyer has to put up a bit more deposit?

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