How to deal with a down valuation on your mortgage valuation.

Dealing with down-valuations

What is a down-valuation?

A down valuation is when the property valuation comes back showing the value of the property is less than what you have agreed to pay for it.

Here’s an example:

If you agree to buy a home for £300,000 but it is down valued to £250,000 then you must bring this the attention of the seller and their estate agent. At this point, it will be down to the agent to advise the seller of how they can move forward.

What options are there?

The estate agent may advise the seller that they need to re-negotiate the purchase price to bring it back to value. However, in instances where there were multiple offers on the property, the estate agent could recommend that the seller chooses a different buyer that doesn’t require a mortgage, or as much of a mortgage who can and would be willing to make up the difference.

Ultimately, it’s the homeowner’s choice what they do at this stage and the estate agent can only offer advice.

Can you fight the valuation?

In some rare instances you may be able to contest the valuation. This isn’t something easily done so you will need the estate agent and your mortgage advisor to be on the ball and hunt for comparable evidence which supports the initial valuation. There is no guarantee that your lender will even consider this, so ask your mortgage expert to give you your best options.

If that doesn’t work?

If you cannot successfully appeal the decision, then you may have to find a new lender. Each lender uses different surveying companies, and you may find that some are more local than others. A local surveyor would be more beneficial as they may find value where others do not.

Down valuations are an unexpected and often stressful addition to your mortgage application. If you’ve been affected by a down valuation and aren’t happy with the way your broker is dealing with it, then you get in touch with Prospect Tree Mortgages to find out what options the wider market has available for you.

How to get in touch?

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