Valuations

At some point in the process a property valuation is required.  This can make or break an application depending on the content of the report.  for the most part they come back as expected, but there are times they don't. 

What are some of the reasons a valuation could cause issues?

These are the most common.

1. The value of the property is less than expected
2. It requires work that the lender will ask for a retention until completed
3. There is enough work required or other issues that the lender won't agree to lend at all

These issues tend to be rare, simply on the basis that the people selling the property will have had an agent look at the property or in the case of Scotland a single survey will have been completed by the time anyone gets to see it with the intention of purchasing.

In the case of point 2 where a retention is required, lets say because of damp in the property.  The valuer tend to indicate to the lender how much that is likely to cost, say £5,000.  The lender will then only agree to the mortgage by withholding that £5,000.  The end result is that the purchaser will need to cover that to complete the purchase and evidence to the lender the damp has been fixed before they will then release the remaining £5,000.

I have a more detailed review of the different types of valuations in (link: https://mortgages.scot/blog/valuation-report-types text: this) post.  And in (link: https://mortgages.scot/blog/how-does-a-valuer-determine-the-value-of-your-home text: this) post I look at who valuers determine the value of a property.