Asked by: Dei Engelbertasked in category: General Last Updated: 9th June, 2020
What if house valuation is less than offer?
Simply so, what happens if a property is down valued?
A 'down valuation' is when a surveyor hired by the mortgage provider decides that the value of a property is at least £10,000 less than the agreed price. If the buyer can't persuade the seller to lower their price, this can result in the house sale falling through.
Similarly, are surveyors valuations accurate? Unfortunately, as many homebuyers believe the mortgage valuation is a survey conducted for their benefit, fewer than one in five take out a Royal Institute of Chartered Surveyors Home Buyer report. Determining an accurate valuation of the property is an important part of this commitment.
Moreover, what happens if bank valuation is lower than purchase price?
There is a risk that property values in the area may change over the construction period. If they do, the bank valuation may be lower than your purchase price. This situation may result in a bank valuation that's less than the purchase price.
How common are down valuations?
According to some statistics, the number of “down-valuations” occurring is on the increase – with up to one in five properties being purchased with a mortgage currently being subject to a “down-valuation”. To understand why this may be, it's important to understand the property valuation process.