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mayonessie

Just Had Home Report Valuer In For Re-Evaluation

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Had an offer on our house a couple of days ago,

Was valued in Feb 2010 by Valuer under Home report as £90K. We had some time going on this figure and basing our prices on this, originally on at 87k then 83k.

Moved agents and have now found a house that we really want so wanted the house sold (priced to sell at 80K) and sold for 75k

As the Hr needs to be under 3 months old for sale just had the a valuer from the same company back in and asked me what the sold price was, I told him, and he said that the HR valuation would have to come down to be in line with this figure and could be up to max of 10% away from the sold price!!!!! So that means that the valuation is now looking to be about £82500.

Will this mean that the buyers mortgage figures will be effected. LTV will be different from a house at 90k to a house at 82500K

Surveyor that came said that original valuer was no longer working for the company as was pricing properties on the 'highside'!!!!!!! Do you think if this effects the sale that I should go to the HR company and complain???

I mean, if the 1st value had been 85k or lower we would have priced accordingly to that figure and probably had a sale a lot quicker.

I was an **** to tell him the sold price (he did say that if I hadnt told him then he would have just called the agent and most offer the info)!!!!

How can they amend the valuation price based on whats been accepted, I could have been really deperate and sold at 30K so would their valuation be £33K???

Maybe Im just panicking, the new HR will be available later today.

Any advice

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I may be missing something here. I understood the mortgage was based on the asking price or valuation -- whichever is lower. The LTV figure will be taken on the agreed price. If it is 75K then the deposit will be in proportion to that.

It would only have affected you if he had valued the house lower than the agreed price.

Exactly-I don't know what you're worrying about-sounds like the HR valuation will be higher than the sold price which is certainly not going to worry the buyer's mortgage company!

By the way-is your HR company on the panel of surveyors used by the buyer's mortgage company? If not then the mortgage company will require their own valuation as well.

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£100+ VAT for 5 mins poke around, there was a score of 2 in electrics for cracked socket plate and old bakerlite socket which was dead, got them both fixed in the past months.

He didn't want to even look for these, I made him to make sure that score was changed to 1!!!

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Got the Home Report through valued at £82K

Spoke to the agent and the buyers will have a problem getting mortgage agreed as they are FTB'ers and offer/mortgage was based on the property being 90K.

I suppose its the banks looking to make sure that they have further equity (if the house valued at 90k has been bought at 75K, then they have 15K equity should things go tits up, compared to the 7K they have now with the new valuation).

The Valuer says that if I can supply details of properties in the area that have gone for a higher price then they will look at it again!!

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What a bloody racket! Talk about consumer capture. You should make the buyer pay, but in this market I suppose they've got you over a barrel.

But won't the home reports mean that mayonaise doesn't need to pay for a survey for any properties they are going to make an offer on?

Surely its better to pay for one survey for your own place, than multiple ones for other peoples?

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But won't the home reports mean that mayonaise doesn't need to pay for a survey for any properties they are going to make an offer on?

Surely its better to pay for one survey for your own place, than multiple ones for other peoples?

Expect he/she didn't pay for one survey, but for TWO. Apparently Home reports suffer from radioactive decay and only have a half life of 3 months. Who knew?

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My home report was done 30th September 2010, I accepted an offer last Friday 14th January, so 3 months and 15 days since it was carried out. The potential buyers mortgage company insisted on a refresh (so I'm told, although I kind of suspect it was the buyer looking to see if it would come down a few grand), anyway it came back at the exact same valuation as the first time so :lol::lol::lol:

Although it did cost me £120.

The legislation does not state that there will be a set validity period for the Home Report document. Depending on different circumstances aspects of the Home Report may well need updating, the decision on this though is up to the sellers, buyers and professional advisers involved with the house. Legislation does however say the documents should be no more than twelve weeks old when the house is put on the market

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Expect he/she didn't pay for one survey, but for TWO. Apparently Home reports suffer from radioactive decay and only have a half life of 3 months. Who knew?

She didn't have to pay for a second home report, she had to pay to have her original one refreshed.

How much would it have cost her to get two surveys done under the old system? More or less?

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She didn't have to pay for a second home report, she had to pay to have her original one refreshed.

How much would it have cost her to get two surveys done under the old system? More or less?

As a vendor it would have cost mayonnaise precisely nothing. But before you start on "yes, but she's buying as well…" you're missing the point, the buyer/lender here is gaming the system and their market advantage to force mayo into buying an unnecessary extra survey in order that she'll have the privilege of selling her house to them - even if you think HRs are the best thing since sliced fire, that is cynically exploiting the legal requirement.

Personally I'd hope I'd have the balls to tell the buyer to go f*ck themselves.

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Got the Home Report through valued at £82K

Spoke to the agent and the buyers will have a problem getting mortgage agreed as they are FTB'ers and offer/mortgage was based on the property being 90K.

I suppose its the banks looking to make sure that they have further equity (if the house valued at 90k has been bought at 75K, then they have 15K equity should things go tits up, compared to the 7K they have now with the new valuation).

The Valuer says that if I can supply details of properties in the area that have gone for a higher price then they will look at it again!!

If the bank gives them a mortgage on that house at £75k instead of £90K it sets the price for other similar houses. They don't want 15% reductions for similar houses on their books.

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Got the Home Report through valued at £82K

Spoke to the agent and the buyers will have a problem getting mortgage agreed as they are FTB'ers and offer/mortgage was based on the property being 90K.

I suppose its the banks looking to make sure that they have further equity (if the house valued at 90k has been bought at 75K, then they have 15K equity should things go tits up, compared to the 7K they have now with the new valuation).

The Valuer says that if I can supply details of properties in the area that have gone for a higher price then they will look at it again!!

Mayonessie

I'm afraid you're being fed a crock of s h i t. Banks calculate the LTV based on the valuation OR sale price, whichever is lower. Therefore your new valuation will have absolutely no bearing on the bank's calculation of LTV, since it is greater than the sale price.

I'm afraid that the idea that banks would lend based on a surveyor's valuation of 90k (or even 82k) when the sale price is 75k is a joke. The banks are many things but a) they are not stupid and B) they are cautious. The place sold for 75k therefore 75k is the market value. The banks would certainly not think that you have any "equity" just because you buy a place for below the valuation-they would simply view the valuation as wrong. After all, the true value of the place has been decided by you marketting the property for a reasonable time and receiving/accepting the offer of £75k.

The only possible explanation for this fiasco is that the buyers mistakenly/naively thought that if they bought your place for £75k and it had a HR value of £90k then they would get a LTV calculated based on 90k e.g. potentially get the full £75k on a LTV of 83%.

It is astonishing that your EA has not spelt this out to you.

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Hi fflump,

Not sure if anything to do with the Scottish market. I'll have a word with the agent on Monday, ive sent the valuer details of properties that have sold recently from the Land Reg details, i've also given him 5 properties that are being marketed at present at about 75-80K by different agents adviertising that the home report is valued at 90-105K and asked him to contact the agents to discuss who valued the properties. (these are all recent additions to Rightmove in the last 3 months).

Not much else I can do, I don't want to further drop the price to 69K just so the buyers can get it by their mortgage company!!!

If the agents lose out on this one they lose the commision on the sale and also the mortgage so (although it hurts me to say it) I think they are doing the best they can as well!!!

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Hi fflump,

Not sure if anything to do with the Scottish market. I'll have a word with the agent on Monday, ive sent the valuer details of properties that have sold recently from the Land Reg details, i've also given him 5 properties that are being marketed at present at about 75-80K by different agents adviertising that the home report is valued at 90-105K and asked him to contact the agents to discuss who valued the properties. (these are all recent additions to Rightmove in the last 3 months).

Not much else I can do, I don't want to further drop the price to 69K just so the buyers can get it by their mortgage company!!!

If the agents lose out on this one they lose the commision on the sale and also the mortgage so (although it hurts me to say it) I think they are doing the best they can as well!!!

mayonessie-the buyer's mortgage provider is only concerned with two things when it comes to calculating the LTV

1) what is the selling price

2) what is the valuation

They calculate the LTV on the lower of the two. Tell your EA to pull his finger out and determine what the problem is. If for some reason they thought they could buy at 75k but with a LTV based on 90k they are not worth botering with. your EA should be sorting this out.

Ask your EA for the following information:

-what LTV does the buyers require based on the sale price of £75k? i.e. £75k=100%

-is there a problem getting a mortgage at this LTV?

These are simple questions and valuations of 90k, 82,5k are totally irrelevant!

Edited by fflump

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home reports are for 12 months not 3.

whats going on here.....?

No in Scotland they are valid from 12 weeks, as decided by the Council of Mortgage Lenders. I wonder if everyone would be happy about that if prices were rising - and despite the BBC reports they aren't.

I am sure that in the original legislation it said reports should be refreshed every 12 weeks but it seems they hadn't figured out that properties would be on the market for over a year !

Also it is very rare for the buyer to pay for a refresh and very few vendors in a position to refuse. The legislation left that deliberately vague and said the 'market would decide'

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Why would you require a refreshed HR to satisfy the buyer/lender when the first thing that the buyer is going to have to do to sort out a mortgage is pay for a survey?

Sounds like someone is being lied to or the banks are playing the system.

I have to say though, my understanding was that the banks calculated the ltv rate on the strength of the valuation/survey report. Ofcourse the banks are not stupid but they treat everyone else like they are so working on a lower valuation = higher ltv = higher interest rate for the mug buyer.

The sale price is the market price and the banks know that but they use the ltv figures and any leverage they can get to extract the highest possible deposit they can from a buyer. It is the deposit that is their cushion and it is higher deposits that they are now looking for as prices are expected to fall further.

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Why would you require a refreshed HR to satisfy the buyer/lender when the first thing that the buyer is going to have to do to sort out a mortgage is pay for a survey?

Sounds like someone is being lied to or the banks are playing the system.

The vast majority of lenders accept the home report survey/refresh so the buyer doesn't have to pay for their own.

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The vast majority of lenders accept the home report survey/refresh so the buyer doesn't have to pay for their own.

an interesting twist,

why as a buyer would you even consider trusting the sellers survey/valuation?

I would always want my own done and know that the banks do to.

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an interesting twist,

why as a buyer would you even consider trusting the sellers survey/valuation?

I would always want my own done and know that the banks do to.

This was a big issue when HRs came in as most people thought that buyers would not trust a survey the seller had instructed. However, this has proved not to be the case. I would be happy for a buyer to get their own survey if they want as long as they pay for it themselves. I know the surveyors we use are all reputable firms who want to protect their own reputations. I am not saying that all firms and areas are the same though.

Initially a lot of lenders were instructing surveys of their own but that has died off now. It has certainly sped up the whole process. The only ones they won't accept are where the report is done by a surveyor not on their panel. There are a few online firms offering reports and I have had a couple of instances where vendors have instructed them and when it came to a sale the lender would not accept it.

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A further twist in this sorry tale is that the surveying company is owned outright by an nationwide estate agency co??????? (the same company that I originally went to sell with as they told me the approx property value was 90K or thereabouts) (I did book another co to do the survey but the EA at the time said that may not be on the lenders panel (maybe right)), but I quote from the T&C of the home report " The ultimate holding company of (surveying co ) is (estate agency group). A full list of estate agents owned by or under franchise to (estate agent) is available on request. Surveyor trades as an entirely separate company and has no financial interest whatsoever in the disposal of the property being inspected. (yeah right!!!!!!)

Interestingly I also note from their original online instruction from the EA to book the valuers,:

Price From: ??85,000 - ??90,000 will have chq at appt for costs, arrange appt with clients Update SS & EPC

entirely separate and independent or maybe telling the valuer what price they want?????

I did change from the original EA in July as they wernt doing a lot of marketing that I could see, including not changing the "prominent advertising" in the window with a price drop that I had instructed 3 months earlier, (only noticed when I went to cancel contract) they also charged a cancellation charge of 150+vat for wishing to terminate with them (outside the contract period of 12 weeks) and move elsewhere (this is standard within the group BEWARE)

Maybe if I was still with the same agent then as its all "in house" I wouldnt be in this predicament, maybe coz I changed to a different EA they want to make it as difficult as possible.

As I said before I have emailed the valuer with proof of other properties around the area valued at 90K, I cant see prices dropping from 90-82K in 10 months, ROS shows price inc of 2.4%, I know there will be areas that have seen drops but by 8%???.

I have have also sent a second email for the valuer of other properties that this group of EA's are advertising which are equivelent properties to ours that they have valued in the last 6 months(i assume they will do by the same valuing company as in house) with prices around the 90K figure they originally gave to me!!!

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