darrude Posted June 30, 2009 Share Posted June 30, 2009 hi all, I'm after some advise if possible please. We looked at buying a house in march / april which we really liked (wife pregnent so need the extra space). It was originally on for 225,000 and then reduced to 215,000. From my own research I valued it at between 165,000 to 175,000 but the seller would not accept under 190,000. anyway the house (we think) has now been reposessed and is on the market for £165,000. by really streching ourselves we can just about scrape together the deposit (originally we were looking to buy using 15% deposit via the mychoice homebuy scheme), but then I started thinking, how does the mortgage company work out the value. Do we have to pay for the survey for the value to be calculated prior to knowing what deposit we will need. How likley is this to be the advertised price, could it work in my favour etc (i offer 150,000, get valued at 165,000 and i don't need any deposit). Is there any way of working out the figures without spending any / too much mony (don't want to apply for a mortgage at £800 and then pay a survey at £500). Thanks in advance, Darren Quote Link to comment Share on other sites More sharing options...
redgenieuk Posted June 30, 2009 Share Posted June 30, 2009 hi all,I'm after some advise if possible please. We looked at buying a house in march / april which we really liked (wife pregnent so need the extra space). It was originally on for 225,000 and then reduced to 215,000. From my own research I valued it at between 165,000 to 175,000 but the seller would not accept under 190,000. anyway the house (we think) has now been reposessed and is on the market for £165,000. by really streching ourselves we can just about scrape together the deposit (originally we were looking to buy using 15% deposit via the mychoice homebuy scheme), but then I started thinking, how does the mortgage company work out the value. Do we have to pay for the survey for the value to be calculated prior to knowing what deposit we will need. How likley is this to be the advertised price, could it work in my favour etc (i offer 150,000, get valued at 165,000 and i don't need any deposit). Is there any way of working out the figures without spending any / too much mony (don't want to apply for a mortgage at £800 and then pay a survey at £500). Thanks in advance, Darren 1) Offer lower by all means. Its a good plan. 2) the house will never be valued at more than you pay, what you pay is the market value. Unless the bank thinks your overpaying, in which case its less. Never more. Quote Link to comment Share on other sites More sharing options...
interestrateripoff Posted June 30, 2009 Share Posted June 30, 2009 You will need a deposit as that's worked out from the sale price not what it might be valued at. Don't stretch yourself financially, don't borrow on your limit as this is asking for trouble. Quote Link to comment Share on other sites More sharing options...
tim123 Posted June 30, 2009 Share Posted June 30, 2009 hi all,I'm after some advise if possible please. We looked at buying a house in march / april which we really liked (wife pregnent so need the extra space). It was originally on for 225,000 and then reduced to 215,000. From my own research I valued it at between 165,000 to 175,000 but the seller would not accept under 190,000. anyway the house (we think) has now been reposessed and is on the market for £165,000. by really streching ourselves we can just about scrape together the deposit (originally we were looking to buy using 15% deposit via the mychoice homebuy scheme), but then I started thinking, how does the mortgage company work out the value. Do we have to pay for the survey for the value to be calculated prior to knowing what deposit we will need. Most repos are priced to sell, but even so there is often scope for a small reduction. You said yourself that you thought it was worth 165 and as that's also 25% less than the original price it's probably about right How likley is this to be the advertised price, could it work in my favour etc (i offer 150,000, get valued at 165,000 and i don't need any deposit). Is there any way of working out the figures without spending any / too much mony (don't want to apply for a mortgage at £800 and then pay a survey at £500).Thanks in advance, Darren Not at all. The deposit required will be a percentage of valuation or purchase price, whichever is lower. tim Quote Link to comment Share on other sites More sharing options...
darrude Posted June 30, 2009 Author Share Posted June 30, 2009 thanks for the replies guy's, I guess my best estimates won't be too far off then. Agree about stretching myself, I could easily afford the repayments, just struggling with the deposit. I could get a loan to get the deposit difference but it doesn't seem right to do this, and i'd have no safety net on my finances. Do many people take loans to cover deposits, are you allowed to do this? think i might see how long it's on the market for, fingers crossed i'll have saved enough by then. Many thanks for your quick reponces guys. Quote Link to comment Share on other sites More sharing options...
scottbeard Posted June 30, 2009 Share Posted June 30, 2009 Do many people take loans to cover deposits, are you allowed to do this? Well you are ALLOWED to do it, but the mortgage company will ask you what other loans you have, and will likely lend you less as a result. Also I have to say it does sound to me like you might be stretching yourself financially too much if you have to do that. Is this particular house really worth it??? Would a slightly cheaper one or a rented house really not do the job? Quote Link to comment Share on other sites More sharing options...
Si1 Posted June 30, 2009 Share Posted June 30, 2009 (wife pregnent so need the extra space). look, once she's given birth she'll be smaller again and anyhow she'll probably be offended if she reads this Quote Link to comment Share on other sites More sharing options...
abharrisson Posted June 30, 2009 Share Posted June 30, 2009 look, once she's given birth she'll be smaller again and anyhow she'll probably be offended if she reads this Narrow minded thinking... she might get smaller but the baby's also there so the space will still be needed. Quote Link to comment Share on other sites More sharing options...
fleabittenmoggie Posted June 30, 2009 Share Posted June 30, 2009 Spoil yourself and get a really decent rental. Enjoy the birth of you child without having to worry about the all the extra crap of owning a house, trust me you'll be busy enough. When life has settled a bit (baby older) it will nicely coincide with a house just as nice being on the market for even less money. Quote Link to comment Share on other sites More sharing options...
dylanthecat Posted June 30, 2009 Share Posted June 30, 2009 break your back, go for a self certified load (liar loan) if need be this could be your last chance house prices are going to start soaring again! if you miss the boat this time, it won't come by again BUY BUY BUY !!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! Quote Link to comment Share on other sites More sharing options...
Akrasia Posted June 30, 2009 Share Posted June 30, 2009 look, once she's given birth she'll be smaller again I don't think it always works like that. Best get a bigger house just in case. Quote Link to comment Share on other sites More sharing options...
darrude Posted June 30, 2009 Author Share Posted June 30, 2009 look, once she's given birth she'll be smaller again and anyhow she'll probably be offended if she reads this Quote Link to comment Share on other sites More sharing options...
andykn Posted June 30, 2009 Share Posted June 30, 2009 As has already been said, surveyors will never value over the agreed price, even if you've got a discount from a friend like I did once. Fundamentally they check for crack free walls (four is their preferred number) and roof (only one of those will do), knock a few grand off the asking price and charge you 185 quid for the privilege. Quote Link to comment Share on other sites More sharing options...
Muskoka Posted June 30, 2009 Share Posted June 30, 2009 Spoil yourself and get a really decent rental. Enjoy the birth of you child without having to worry about the all the extra crap of owning a house, trust me you'll be busy enough. When life has settled a bit (baby older) it will nicely coincide with a house just as nice being on the market for even less money. Above comment makes a whole load of sense. Whatever house prices are doing, they are NOT going up. You don't know how much hard work a baby is until it has arrived. I am absolutely totally convinced you should rent for a year to give yourself the chance to adapt to having a baby around. You could regret buying, but you cannot regret renting because in renting you aren't in debt and can always move elsewhere PLUS you can afford a nicer house renting than you would buying. (I'd review once baby is 12 months old or thereabouts) Quote Link to comment Share on other sites More sharing options...
darrude Posted July 1, 2009 Author Share Posted July 1, 2009 thanks for feed back everyone. i have had a good think and spoken to my mum and dad, and we decided to make a silly offer, 145,000 which has already been rejected. The estate agent has said that 160,000 would be accpeted, but I said no to that. they explained what a bargain it was and how it's alrady had a considerable reduction, to which i replied, well it was obviously massivly overpriced then! anyway's I'll leave it for a week then remind them offer still stands, if they don't want to take it and get rid quick, then i'll wait and buy it, or something similar next year for the same price! Quote Link to comment Share on other sites More sharing options...
Guest DissipatedYouthIsValuable Posted July 1, 2009 Share Posted July 1, 2009 thanks for feed back everyone.i have had a good think and spoken to my mum and dad, and we decided to make a silly offer, 145,000 which has already been rejected. The estate agent has said that 160,000 would be accpeted, but I said no to that. they explained what a bargain it was and how it's alrady had a considerable reduction, to which i replied, well it was obviously massivly overpriced then! anyway's I'll leave it for a week then remind them offer still stands, if they don't want to take it and get rid quick, then i'll wait and buy it, or something similar next year for the same price! Stick to it. £145000 is a lot of money, especially once you've factored in interest payments. Quote Link to comment Share on other sites More sharing options...
Neil B Posted July 1, 2009 Share Posted July 1, 2009 (edited) hi all,I'm after some advise if possible please. We looked at buying a house in march / april which we really liked (wife pregnent so need the extra space). It was originally on for 225,000 and then reduced to 215,000. From my own research I valued it at between 165,000 to 175,000 but the seller would not accept under 190,000. anyway the house (we think) has now been reposessed and is on the market for £165,000. by really streching ourselves we can just about scrape together the deposit (originally we were looking to buy using 15% deposit via the mychoice homebuy scheme), but then I started thinking, how does the mortgage company work out the value. Do we have to pay for the survey for the value to be calculated prior to knowing what deposit we will need. How likley is this to be the advertised price, could it work in my favour etc (i offer 150,000, get valued at 165,000 and i don't need any deposit). Is there any way of working out the figures without spending any / too much mony (don't want to apply for a mortgage at £800 and then pay a survey at £500). Thanks in advance, Darren The bank's valuer decides how much the property is worth: You cant trust an EA anymore. This is a great 'real life' post that actually shows that what the seller thinks their property is worth (and that includes EAs) and what the actual value is, is vastly different. 30% is frequently quoted now and I see from your figures that the seller was over valuing their property by 27%. You can request a valuation to be done prior to putting an offer in - it costs around £250 and you might find that the value is even less. Edited July 1, 2009 by Neil B Quote Link to comment Share on other sites More sharing options...
Spark Posted July 1, 2009 Share Posted July 1, 2009 1) Offer lower by all means. Its a good plan.2) the house will never be valued at more than you pay, what you pay is the market value. Unless the bank thinks your overpaying, in which case its less. Never more. +1 Another thing is although you pay the valuation fee, the RICS surveyor reports back to the lender. You don't find out what the valuer thinks what the house is worth UNLESS it is below what you were prepared to pay. If you want to know what the surveyor thought of the place then it's better to pay around £400-500 for a homebuyers report. They will send you a 6 page document listing any minor defects they have found and an estimated value. This report sometimes pays for itself, as if some problems are found you may be able negotiate the price down accordingly. Quote Link to comment Share on other sites More sharing options...
darrude Posted July 1, 2009 Author Share Posted July 1, 2009 Another thing is although you pay the valuation fee, the RICS surveyor reports back to the lender. You don't find out what the valuer thinks what the house is worth UNLESS it is below what you were prepared to pay. If you want to know what the surveyor thought of the place then it's better to pay around £400-500 for a homebuyers report. They will send you a 6 page document listing any minor defects they have found and an estimated value. This report sometimes pays for itself, as if some problems are found you may be able negotiate the price down accordingly. that's interesting to know, we looked at another that we both really like, but so overpriced. I guess the only issue would be getting the seller to drop to your valuation. Would be a good negotating tool to use if you knew the seller was desperate. Thanks. Quote Link to comment Share on other sites More sharing options...
RufflesTheGuineaPig Posted July 1, 2009 Share Posted July 1, 2009 Spoil yourself and get a really decent rental. Enjoy the birth of you child without having to worry about the all the extra crap of owning a house, trust me you'll be busy enough. When life has settled a bit (baby older) it will nicely coincide with a house just as nice being on the market for even less money. +1 Quote Link to comment Share on other sites More sharing options...
geoffk Posted July 1, 2009 Share Posted July 1, 2009 Can you afford 8 to 10% interest rate payments because at some stage they will arrive...but when? Quote Link to comment Share on other sites More sharing options...
Spark Posted July 1, 2009 Share Posted July 1, 2009 that's interesting to know, we looked at another that we both really like, but so overpriced. I guess the only issue would be getting the seller to drop to your valuation.Would be a good negotating tool to use if you knew the seller was desperate. Thanks. Yes, it's a win-win situation really. Pay an extra £200 or so for some peace of mind. The 2 outcomes are: 1) Place gets a clean bill of health and the surveyor confirms you are paying a reasonable price. 2) Surveyor finds a few things that the average person might not spot. When I bought my own (was 30+ years old) house it got a reasonable report. Just minor things like the loft didn't have enough insulation, loft insufficiently ventilated and the chimney needed repointing. The chimney repointing seems to be a favourite one for the surveyors to use! I looked at mine when I was fitting a digital aerial and it wasn't too bad! I still haven't repointed it. My folks got £2K knocked off a house they were buying in the 1990's as the porch was subsiding slightly and had a dodgy flat roof. Nothing major, but he down-valued the place by £2K and the vendor knocked the £2K off the negotiated price. Quote Link to comment Share on other sites More sharing options...
tomandlu Posted July 1, 2009 Share Posted July 1, 2009 Narrow minded thinking... she might get smaller but the baby's also there so the space will still be needed. If you liquidise them, they can fit in pretty much any waterproof container, and require less feeding. Put them in feet first, 'cos then you get to see the funny expression on their cute little face. Quote Link to comment Share on other sites More sharing options...
darrude Posted July 2, 2009 Author Share Posted July 2, 2009 Can you afford 8 to 10% interest rate payments because at some stage they will arrive...but when? my affordability calculations are based on 12%, and no overtime, which is when things are getting tight, especially if inflation shoots up like it probably will. the interest on the mortgage will be over 6% Quote Link to comment Share on other sites More sharing options...
darrude Posted July 2, 2009 Author Share Posted July 2, 2009 If you liquidise them, they can fit in pretty much any waterproof container, and require less feeding.Put them in feet first, 'cos then you get to see the funny expression on their cute little face. Quote Link to comment Share on other sites More sharing options...
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