Getting 'valuation' of a unique property
Discussion
TA14 said:
No, the valuer has to value for a sale between a willing seller and a willing buyer. In your example he would have to value at £1M with a footnote that if a quick sale is required the discount needed to be given may be a higher % than for a more conventional property. (Otherwise, as you point out, you'd end up with the property being valued at £1.)
So... for a valuer to recommend to a mortgage company not to lend at all, says what? That reducing it for a quick sale won't work?It means you need a new valuer and possibly different mort co. unless there's a major issue that you're not mentioning.
The only other scenario is that you're the only person who will ever buy it and no matter how cheap no one will ever be interested in that property. Do you really think that this is the situation? If you believe this you may as well post up the Rightmove link.
The only other scenario is that you're the only person who will ever buy it and no matter how cheap no one will ever be interested in that property. Do you really think that this is the situation? If you believe this you may as well post up the Rightmove link.
TA14 said:
It means you need a new valuer and possibly different mort co. unless there's a major issue that you're not mentioning.
The only other scenario is that you're the only person who will ever buy it and no matter how cheap no one will ever be interested in that property. Do you really think that this is the situation? If you believe this you may as well post up the Rightmove link.
Oh, we'd definitely need a new mortgage company. That's a given. The valuer was instructed by the mortgage company, so we had no control over that. That's why I was asking about getting an 'independent' valuation - a second opinion, without ties or links to the mortgage company. The only other scenario is that you're the only person who will ever buy it and no matter how cheap no one will ever be interested in that property. Do you really think that this is the situation? If you believe this you may as well post up the Rightmove link.
No, I don't believe that we are the only people, no matter how cheap, who would ever be interested in buying it. Of course not!
But you can have a Rightmove link anyway: http://www.rightmove.co.uk/property-for-sale/prope...
Valuer agrees the conversion is a superb one (the owners haven't skimped on anything, or cut any corners in fit/finish) but he is absolutely fine to go down on record to recommend the mortgage don't lend on it.
Unless he's on their payroll (and isn't independent) I can't see how that's the mortgage company's problem. They're just reacting to the advice given to them.
Switching to another lender would definitely cost more. How much more I don't know yet. But if the property is now difficult to mortgage, that's as much the vendor's problem as it is ours. In many ways its a greater problem to them, as we could walk away and either stay put or find an alternative, whereas they're 'stuck' with a property that's likely to be increasingly hard to sell at anywhere close to their asking price.
But its hard to argue with the fact that if the valuer is 'paid' to give this advice (whether on their payroll or instructed for this job), and he stands by it, then although every man and his dog says 'lovely house', we struggle to get a mortgage even when putting down more money thank the bank are. And at the end of the day, no matter whether his opinion is right or wrong, he's the 'authority' as far as this goes, so he's 'right' regardless.
Bloody annoying.
timetex said:
So... for a valuer to recommend to a mortgage company not to lend at all, says what? That reducing it for a quick sale won't work?
I'm not sure they're saying that exactly, they're saying it might not be saleable quickly. If that's not compatible with the lenders business model, then they won't lend, but it's the lender that makes that call. It's still worth what it's worth, but they're left chasing you for an unsecured debt if you had to cut and run and that is a risk for them.Now a 'proper' lender should be able to look at your profile and factor in the likelihood of you having to cut and run, your loan to value ratio and how that will change over time to work out how long they'd be exposed to that risk for and then make a decision based on that. You should at least have the choice of adjusting LTV to cover the risk.
paulrockliffe said:
I'm not sure they're saying that exactly, they're saying it might not be saleable quickly. If that's not compatible with the lenders business model, then they won't lend, but it's the lender that makes that call. It's still worth what it's worth, but they're left chasing you for an unsecured debt if you had to cut and run and that is a risk for them.
Now a 'proper' lender should be able to look at your profile and factor in the likelihood of you having to cut and run, your loan to value ratio and how that will change over time to work out how long they'd be exposed to that risk for and then make a decision based on that. You should at least have the choice of adjusting LTV to cover the risk.
No, it was somewhat of a facetious question!Now a 'proper' lender should be able to look at your profile and factor in the likelihood of you having to cut and run, your loan to value ratio and how that will change over time to work out how long they'd be exposed to that risk for and then make a decision based on that. You should at least have the choice of adjusting LTV to cover the risk.
From the wording of the valuer's message, it doesn't sound like the lender is making the decision, but that the valuer is making a recommendation that they don't lend and that the mortgage company are simply following suit.
We're already at a LTV of under 50%, and although that's not a 'magic' number, it does mean that we're putting more money in than they are. If that doesn't cover the risk, I'm not sure it is a sound purchase anyway!
Strikes me this valuer is up to one of 2 things:
1) Considering the security from the lending "rules" or "principles" the lender generally espouses (eg anything weird is a no) or
2) they are absolutely completely and utterly incompetent.
Ref 1) Lenders like average houses because they have an average value and are good for the average buyer. They don't like things outside that. Which is why specialist lenders exist for all manner of otherwise entirely conventional looking houses that simply may have been built (for example) under a particular construction type (eg concrete), and plenty of mainstream lenders have the experience and common sense to know people want to buy them, so they fit within their rules or principles. Any decent broker should be able to advise as to who would lend on this, you have simply gone back to your existing lender, whose rules may not be clear to you.
Ref 2) There is a plot of land with planning permission (I assume) for a dwelling of a particular size (at the moment) with mains services connected. Therefore there IS a value, therefore it would be *at least some* suitable security for lending.
If you are so tied to your current lender that it's the only way this move can work, I'd suggest you aren't in a buying place anyway. If not, speak to any broker, who if they are in any doubt, can speak to the lender's rep to confirm where in the rules or principles they apply this would sit.
1) Considering the security from the lending "rules" or "principles" the lender generally espouses (eg anything weird is a no) or
2) they are absolutely completely and utterly incompetent.
Ref 1) Lenders like average houses because they have an average value and are good for the average buyer. They don't like things outside that. Which is why specialist lenders exist for all manner of otherwise entirely conventional looking houses that simply may have been built (for example) under a particular construction type (eg concrete), and plenty of mainstream lenders have the experience and common sense to know people want to buy them, so they fit within their rules or principles. Any decent broker should be able to advise as to who would lend on this, you have simply gone back to your existing lender, whose rules may not be clear to you.
Ref 2) There is a plot of land with planning permission (I assume) for a dwelling of a particular size (at the moment) with mains services connected. Therefore there IS a value, therefore it would be *at least some* suitable security for lending.
If you are so tied to your current lender that it's the only way this move can work, I'd suggest you aren't in a buying place anyway. If not, speak to any broker, who if they are in any doubt, can speak to the lender's rep to confirm where in the rules or principles they apply this would sit.
Croutons said:
Strikes me this valuer is up to one of 2 things:
1) Considering the security from the lending "rules" or "principles" the lender generally espouses (eg anything weird is a no) or
2) they are absolutely completely and utterly incompetent.
Ref 1) Lenders like average houses because they have an average value and are good for the average buyer. They don't like things outside that. Which is why specialist lenders exist for all manner of otherwise entirely conventional looking houses that simply may have been built (for example) under a particular construction type (eg concrete), and plenty of mainstream lenders have the experience and common sense to know people want to buy them, so they fit within their rules or principles. Any decent broker should be able to advise as to who would lend on this, you have simply gone back to your existing lender, whose rules may not be clear to you.
Ref 2) There is a plot of land with planning permission (I assume) for a dwelling of a particular size (at the moment) with mains services connected. Therefore there IS a value, therefore it would be *at least some* suitable security for lending.
If you are so tied to your current lender that it's the only way this move can work, I'd suggest you aren't in a buying place anyway. If not, speak to any broker, who if they are in any doubt, can speak to the lender's rep to confirm where in the rules or principles they apply this would sit.
It seems to be heading towards 2) since when you click on the link it's a lovely place and will obviously have a value.1) Considering the security from the lending "rules" or "principles" the lender generally espouses (eg anything weird is a no) or
2) they are absolutely completely and utterly incompetent.
Ref 1) Lenders like average houses because they have an average value and are good for the average buyer. They don't like things outside that. Which is why specialist lenders exist for all manner of otherwise entirely conventional looking houses that simply may have been built (for example) under a particular construction type (eg concrete), and plenty of mainstream lenders have the experience and common sense to know people want to buy them, so they fit within their rules or principles. Any decent broker should be able to advise as to who would lend on this, you have simply gone back to your existing lender, whose rules may not be clear to you.
Ref 2) There is a plot of land with planning permission (I assume) for a dwelling of a particular size (at the moment) with mains services connected. Therefore there IS a value, therefore it would be *at least some* suitable security for lending.
If you are so tied to your current lender that it's the only way this move can work, I'd suggest you aren't in a buying place anyway. If not, speak to any broker, who if they are in any doubt, can speak to the lender's rep to confirm where in the rules or principles they apply this would sit.
Some people like former churches and graveyards whilst others wouldn't touch them with a bargepole.
I wonder what the sellers would make of this if they read this thread.
Croutons said:
Strikes me this valuer is up to one of 2 things:
1) Considering the security from the lending "rules" or "principles" the lender generally espouses (eg anything weird is a no) or
2) they are absolutely completely and utterly incompetent.
Ref 1) Lenders like average houses because they have an average value and are good for the average buyer. They don't like things outside that. Which is why specialist lenders exist for all manner of otherwise entirely conventional looking houses that simply may have been built (for example) under a particular construction type (eg concrete), and plenty of mainstream lenders have the experience and common sense to know people want to buy them, so they fit within their rules or principles. Any decent broker should be able to advise as to who would lend on this, you have simply gone back to your existing lender, whose rules may not be clear to you.
Ref 2) There is a plot of land with planning permission (I assume) for a dwelling of a particular size (at the moment) with mains services connected. Therefore there IS a value, therefore it would be *at least some* suitable security for lending.
If you are so tied to your current lender that it's the only way this move can work, I'd suggest you aren't in a buying place anyway. If not, speak to any broker, who if they are in any doubt, can speak to the lender's rep to confirm where in the rules or principles they apply this would sit.
It isn't that we are so tied to our existing lender - although the ERCs would sting a bit if we leave them before November, but it wouldn't be insurmountable. The broker supported (in fact suggested) staying with our existing lender, since they have a good relationship with them (at least on the underwriting score, if not dealing with valuations!). 1) Considering the security from the lending "rules" or "principles" the lender generally espouses (eg anything weird is a no) or
2) they are absolutely completely and utterly incompetent.
Ref 1) Lenders like average houses because they have an average value and are good for the average buyer. They don't like things outside that. Which is why specialist lenders exist for all manner of otherwise entirely conventional looking houses that simply may have been built (for example) under a particular construction type (eg concrete), and plenty of mainstream lenders have the experience and common sense to know people want to buy them, so they fit within their rules or principles. Any decent broker should be able to advise as to who would lend on this, you have simply gone back to your existing lender, whose rules may not be clear to you.
Ref 2) There is a plot of land with planning permission (I assume) for a dwelling of a particular size (at the moment) with mains services connected. Therefore there IS a value, therefore it would be *at least some* suitable security for lending.
If you are so tied to your current lender that it's the only way this move can work, I'd suggest you aren't in a buying place anyway. If not, speak to any broker, who if they are in any doubt, can speak to the lender's rep to confirm where in the rules or principles they apply this would sit.
Broker has suggested a chat to see which other lenders would be more amenable - but it has obviously given us a big cause for concern that anything which makes it more difficult for US to purchase, would make it harder to resell in future as well.
That's quite a big worry.
You could argue that if this particular lender had allowed us to go ahead and purchase, there might still have been issues later down the line if we came to resell, and we'd have been none the wiser - but now having had one 'bad' valuation, it does open the eyes somewhat.
TA14 said:
I wonder what the sellers would make of this if they read this thread.
I've not said anything I wouldn't already expect they've been thinking for themselves, and nothing I wouldn't discuss with them, either directly or via the Agent.It doesn't stop me loving the property and wanting to live there, but the simple fact is, either the valuer is WAY out of line with his comments, or there really is an underlying issue with potential re-sale which we really should be taking seriously.
...especially when what we are selling to buy this is a predictable, 'normal', new(ish) build, which is easy and safe to value, in an area seeing continued strong gains!
Was happy (in fact, looking forward!) to getting out of this place to somewhere more unique, more rural, with more character - and happy to trade the 'certainty' of the current property for something a bit different - but not to the extent that the very first valuation we have done comes back as 'unmortgageable'. That's a step too far.
timetex said:
It isn't that we are so tied to our existing lender - although the ERCs would sting a bit if we leave them before November, but it wouldn't be insurmountable. The broker supported (in fact suggested) staying with our existing lender, since they have a good relationship with them (at least on the underwriting score, if not dealing with valuations!).
Broker has suggested a chat to see which other lenders would be more amenable - but it has obviously given us a big cause for concern that anything which makes it more difficult for US to purchase, would make it harder to resell in future as well.
That's quite a big worry.
You could argue that if this particular lender had allowed us to go ahead and purchase, there might still have been issues later down the line if we came to resell, and we'd have been none the wiser - but now having had one 'bad' valuation, it does open the eyes somewhat.
Your broker did the maths on the ERC's and the cost to move you to another lender and was nigh-on forced to tell you staying made sense, as any other recommendation would be remarkably difficult to justify with (I strongly suspect) the assumption that they would lend. Broker has suggested a chat to see which other lenders would be more amenable - but it has obviously given us a big cause for concern that anything which makes it more difficult for US to purchase, would make it harder to resell in future as well.
That's quite a big worry.
You could argue that if this particular lender had allowed us to go ahead and purchase, there might still have been issues later down the line if we came to resell, and we'd have been none the wiser - but now having had one 'bad' valuation, it does open the eyes somewhat.
I very seriously doubt they would have called your lender and asked what they'd make of a church conversion, as I think like most people (s)he would reasonably assume an expensive property that is not that uncommon for people to live in is mortgageable, and what is in it for them to do so if you've told them you can port your loan...
Given the % of property purchased without mortgage is increasing, I think you just need the right lender(s) (of which there will be many), not to think this is catastrophic.
Croutons said:
Your broker did the maths on the ERC's and the cost to move you to another lender and was nigh-on forced to tell you staying made sense, as any other recommendation would be remarkably difficult to justify with (I strongly suspect) the assumption that they would lend.
I very seriously doubt they would have called your lender and asked what they'd make of a church conversion, as I think like most people (s)he would reasonably assume an expensive property that is not that uncommon for people to live in is mortgageable, and what is in it for them to do so if you've told them you can port your loan...
Given the % of property purchased without mortgage is increasing, I think you just need the right lender(s) (of which there will be many), not to think this is catastrophic.
Actually at least one of your assumptions is wrong. The broker had already spoken to the Head of Leading and Head of Surveying at Santander and since the church is brick, with normal roof, and they were (in principle) happy to lend on it.I very seriously doubt they would have called your lender and asked what they'd make of a church conversion, as I think like most people (s)he would reasonably assume an expensive property that is not that uncommon for people to live in is mortgageable, and what is in it for them to do so if you've told them you can port your loan...
Given the % of property purchased without mortgage is increasing, I think you just need the right lender(s) (of which there will be many), not to think this is catastrophic.
It is just the comments from the valuer which have caused the issues.
I've spoken again to the broker, and a) the valuer is definitely independent, b) there are reasons why the relatively low LTV doesn't make much difference, and c) nobody knows why the valuer didn't just put a value (even if marked down significantly) rather than just 'computer says no'
If anyone cares, the reasoning for b) was as follows. In the event of a repossession, the lender has a duty to get the highest possible price for the house. They can't just sell it for 50% of the value to cover the amount of the mortgage.
c) we can't be sure of, but its possible he just couldn't make an accurate valuation, and didn't want to be 'wrong', so giving no valuation whatsoever is the cop-out option.
Broker is certain he can get it mortgaged with a different main stream lender, so perhaps the way forward is to have a new application made, a new valuation done (this time, hopefully one where the valuer will commit to a valuation range!) and see what that comes back with. For a few hundred quid, I know it sounds mad, but I may even go 'best of 3' and instruct a 3rd, totally independent valuation. The thinking being, if 2 of the valuations are 'bad' or 'avoid', then I have my answer - but if 2 of them are 'good' then it makes the current one more of an anomaly and give some confidence that we aren't buying a total white elephant for too much money!
Bizarre thread in lots of ways.
OK. First of all - if the property falls outside the lenders criteria a valuer will return no value. Presumably as his take is the as the property is not saleable to the general market it falls outside the criteria.
Secondly. It's bull. It's a conversion - a nice one by the look of it. It has walls, doors, roof and window. It's not in a s
thole of an area - in short there is no reason why the market would be restricted other than it will be an expensive property. I wonder aloud whether Santander can be lent on to get a second opinion.
On the initial idea of getting a second valuation - I'd normally say that's pointless as the lenders valuer should be working to a fairly standard criteria. Unfortunately this valuer has proved me wrong.
I saw somewhere someone say it will be a valuer not a surveyor - the chances are that the Valuation will have been done by a Chartered Surveyor. They will not be doing a full survey obviously but will be expected to report on either value significant defects or defects that will effect the lenders security. EG if it's falling down....
There is no database of previous valuations- unless done by someone in the same firm. Typically little or no relevance should be given to a valuation which either is not a sale or does not complete. To anyone looking on the database though - sales which collapse may not be obvious.
Lastly... Valuation of unique properties is an art - and the cause of grey hair. Having said that in my view it's more likely that you will get valued at the sale price - the general argument being that a willing buyer and a willing seller agreeing a price is pretty good open market evidence - and there is likely to be limited evidence to show that the price is too high...
OK. First of all - if the property falls outside the lenders criteria a valuer will return no value. Presumably as his take is the as the property is not saleable to the general market it falls outside the criteria.
Secondly. It's bull. It's a conversion - a nice one by the look of it. It has walls, doors, roof and window. It's not in a s
thole of an area - in short there is no reason why the market would be restricted other than it will be an expensive property. I wonder aloud whether Santander can be lent on to get a second opinion. On the initial idea of getting a second valuation - I'd normally say that's pointless as the lenders valuer should be working to a fairly standard criteria. Unfortunately this valuer has proved me wrong.
I saw somewhere someone say it will be a valuer not a surveyor - the chances are that the Valuation will have been done by a Chartered Surveyor. They will not be doing a full survey obviously but will be expected to report on either value significant defects or defects that will effect the lenders security. EG if it's falling down....
There is no database of previous valuations- unless done by someone in the same firm. Typically little or no relevance should be given to a valuation which either is not a sale or does not complete. To anyone looking on the database though - sales which collapse may not be obvious.
Lastly... Valuation of unique properties is an art - and the cause of grey hair. Having said that in my view it's more likely that you will get valued at the sale price - the general argument being that a willing buyer and a willing seller agreeing a price is pretty good open market evidence - and there is likely to be limited evidence to show that the price is too high...
timetex said:
No, I don't believe that we are the only people, no matter how cheap, who would ever be interested in buying it. Of course not!
But you can have a Rightmove link anyway: http://www.rightmove.co.uk/property-for-sale/prope...
I agree with the valuer who on earth would want to live in that.But you can have a Rightmove link anyway: http://www.rightmove.co.uk/property-for-sale/prope...
What an arse, it's superb !
I admit I'd have to consider the heating bills and personally it wouldn't suit me as I need land / outbuildings but I'd happily invest 50% of that and sleep very soundly.
Find a better Mortgage Co / valuer with experience in this market.
surveyor said:
Bizarre thread in lots of ways.
OK. First of all - if the property falls outside the lenders criteria a valuer will return no value. Presumably as his take is the as the property is not saleable to the general market it falls outside the criteria.
Secondly. It's bull. It's a conversion - a nice one by the look of it. It has walls, doors, roof and window. It's not in a sthole of an area - in short there is no reason why the market would be restricted other than it will be an expensive property. I wonder aloud whether Santander can be lent on to get a second opinion.
On the initial idea of getting a second valuation - I'd normally say that's pointless as the lenders valuer should be working to a fairly standard criteria. Unfortunately this valuer has proved me wrong.
I saw somewhere someone say it will be a valuer not a surveyor - the chances are that the Valuation will have been done by a Chartered Surveyor. They will not be doing a full survey obviously but will be expected to report on either value significant defects or defects that will effect the lenders security. EG if it's falling down....
There is no database of previous valuations- unless done by someone in the same firm. Typically little or no relevance should be given to a valuation which either is not a sale or does not complete. To anyone looking on the database though - sales which collapse may not be obvious.
Lastly... Valuation of unique properties is an art - and the cause of grey hair. Having said that in my view it's more likely that you will get valued at the sale price - the general argument being that a willing buyer and a willing seller agreeing a price is pretty good open market evidence - and there is likely to be limited evidence to show that the price is too high...
Thank you so much for this response. It kinda sums up exactly where I'd got to in my own mind. The only thing I question is why the valuer is working to the lender's criteria so closely. I would have anticipated he'd return comments and figures and the lender would then interpret these according to their own criteria, as each lender would have slightly different rules. In other words, he's independent, doesn't work for Santander, so I thought he'd give an opinion independent of their 'rules' and let them decide. But its a moot point as that's obviously not what happened.OK. First of all - if the property falls outside the lenders criteria a valuer will return no value. Presumably as his take is the as the property is not saleable to the general market it falls outside the criteria.
Secondly. It's bull. It's a conversion - a nice one by the look of it. It has walls, doors, roof and window. It's not in a s
thole of an area - in short there is no reason why the market would be restricted other than it will be an expensive property. I wonder aloud whether Santander can be lent on to get a second opinion. On the initial idea of getting a second valuation - I'd normally say that's pointless as the lenders valuer should be working to a fairly standard criteria. Unfortunately this valuer has proved me wrong.
I saw somewhere someone say it will be a valuer not a surveyor - the chances are that the Valuation will have been done by a Chartered Surveyor. They will not be doing a full survey obviously but will be expected to report on either value significant defects or defects that will effect the lenders security. EG if it's falling down....
There is no database of previous valuations- unless done by someone in the same firm. Typically little or no relevance should be given to a valuation which either is not a sale or does not complete. To anyone looking on the database though - sales which collapse may not be obvious.
Lastly... Valuation of unique properties is an art - and the cause of grey hair. Having said that in my view it's more likely that you will get valued at the sale price - the general argument being that a willing buyer and a willing seller agreeing a price is pretty good open market evidence - and there is likely to be limited evidence to show that the price is too high...
Santander cannot be leant upon to deal with a second valuation. That's a no-no with their internal policies, I'm told. It used to be OK, but they won't anymore. I can understand this - so if we need to deal with a second lender that's fine by me, as long as it doesn't need to be a specialist one (which it won't be) as I don't want that to be a condition of purchase (that it can only be mortgaged through a specialist).
Mrs Timetex is now pretty nervous about the whole thing, naturally - although I'm a bit more 'let's just find another route and sort it out', now I'm more convinced the original valuer / valuation was a cop-out. So the challenge is to convince her to move forward, if only to get it revalued and then re-evaluate our position from there. Although most people are suggesting this course of action, it's quite easy to say 'oh the valuer is obviously wrong' when it isn't their cash at stake, so apologies for being perhaps overly-cautious but that's just the way it is.
Have had feedback from the vendor - they were obviously shocked by this as well.
Rights and wrongs aside, I am somewhat confused that they refused, based on the fact that you are contributing half the cost of the house.
The bank can't be worried that they will get their money back here, and they will have first lean on the entire value of your house.
So if its a pretty safe bet that they are contributing to half your house but have the ability to sell all of it to recover their money if you default, why are they objecting?
The bank can't be worried that they will get their money back here, and they will have first lean on the entire value of your house.
So if its a pretty safe bet that they are contributing to half your house but have the ability to sell all of it to recover their money if you default, why are they objecting?
julian64 said:
Rights and wrongs aside, I am somewhat confused that they refused, based on the fact that you are contributing half the cost of the house.
The bank can't be worried that they will get their money back here, and they will have first lean on the entire value of your house.
So if its a pretty safe bet that they are contributing to half your house but have the ability to sell all of it to recover their money if you default, why are they objecting?
Because of the limited market (supposedly) it falls outside their lending criteria. Their interest stops there.The bank can't be worried that they will get their money back here, and they will have first lean on the entire value of your house.
So if its a pretty safe bet that they are contributing to half your house but have the ability to sell all of it to recover their money if you default, why are they objecting?
I do think the reason that the valuer gave for if falling outside is a bit crap. I can't believe that they have no appeals process in place - no valuer is 100% accurate and there will always be mistakes.
julian64 said:
Rights and wrongs aside, I am somewhat confused that they refused, based on the fact that you are contributing half the cost of the house.
The bank can't be worried that they will get their money back here, and they will have first lean on the entire value of your house.
So if its a pretty safe bet that they are contributing to half your house but have the ability to sell all of it to recover their money if you default, why are they objecting?
This was my question... but I received a satisfactory answer which may be buried in the mumblings above, plus what surveyor has said above as well.The bank can't be worried that they will get their money back here, and they will have first lean on the entire value of your house.
So if its a pretty safe bet that they are contributing to half your house but have the ability to sell all of it to recover their money if you default, why are they objecting?
Aside from the answer given by surveyor, the other answer I received (which I've also independently verified) is that the lender is under a legal obligation to try and get back as close to market price for the property as possible. They cannot just dump the house at any price, sufficient to cover their own loan, and have done with it... if they don't hold out out for a reasonable price, they are open to action by the mortgage holder.
So assuming the lender repossessed the property, they could potentially be tied up with it for a longer period (being a unique, niche house) to get that 'reasonable price' than if it was just another 'box' in a row of other houses.
So presumably taking that to the extreme, they could be landed with a slow-selling 'unique' property, with a 'high' valuation but no prospect of a quick sale. Without the opportunity to severely down value the property to sell it quicker.
Even so, I can't understand why not just give the place a value, but say it might need to be discounted by a larger % in order to realise a quicker sale.
timetex said:
the lender is under a legal obligation to try and get back as close to market price for the property as possible. They cannot just dump the house at any price, sufficient to cover their own loan, and have done with it... if they don't hold out out for a reasonable price, they are open to action by the mortgage holder.
So assuming the lender repossessed the property, they could potentially be tied up with it for a longer period (being a unique, niche house) to get that 'reasonable price' than if it was just another 'box' in a row of other houses.
All they do is stick it on with an Agent at their best guess of Market value with an eye to sell quickly.So assuming the lender repossessed the property, they could potentially be tied up with it for a longer period (being a unique, niche house) to get that 'reasonable price' than if it was just another 'box' in a row of other houses.
If it doesn't sell it's reduced and after around 6 months to a year it's stuck into an Auction.
That's what happened with an Associate's house who lost his job just after he'd personalised it so that it pretty much only appealed to him.
It started at £1.4M was dropped to £1.2M and eventually sold for £1M - it was due to go to Auction as it had been advertised for almost a year.
TBH I thought the Bank were more than reasonable with their timescales.
Gassing Station | Homes, Gardens and DIY | Top of Page | What's New | My Stuff