Down valuation

In this current market, some people are experiencing situations where they’re looking to remortgage and apply for the mortgage only to find their new lender doesn’t agree with what they think their property is worth.

If your remortgage valuation comes back less than you were expecting, it's called a "down valuation". This can have a number of implications, depending on the circumstances.

Reduced borrowing capacity: Lenders typically base their loan offers on a percentage of the property's value. A down valuation means your loan-to-value (LTV) ratio will increase, potentially limiting the funds you can access. This could mean you ?may not be able to borrow as much as you wanted to.? It could also mean to borrow what you wanted to, you may have to select a higher rate (in a higher LTV band).?

Affordability reassessment: Lenders may review your affordability based on the lower valuation. This could lead to additional documentation or adjustments to your mortgage terms.

Comparable evidence: If you're unhappy with the down valuation, you can try to challenge the valuation figure. This may involve providing additional evidence of your property's value, such as recent sale prices of similar properties in your area.

Seeking alternative quotes: You can also consider seeking quotes from other lenders, i.e. having another lender value your home in the hope it values at what you want it to value at.

Addressing any issues: If the down valuation is due to specific issues with your property, you may be able to address those issues to improve its valuation. This could involve making repairs, improving the curb appeal, or staging the property.

Here are some additional tips for dealing with a down valuation:

• Stay calm and don't panic.?Down valuations are not uncommon,?and there are usually options available to resolve the issue.
• Communicate with your broker about your viable options.
• Seek professional advice.?If you hadn’t applied for a mortgage through a broker then a mortgage broker can help you understand your options and navigate the process of dealing with a down valuation.

With careful planning and communication, you can usually find a way to overcome a down valuation and achieve your remortgage goals.

#remortgage?#mortgage?#mortgagebroker?#property

This post is for information purposes only and shouldn’t be viewed as advice. Please seek advice from a mortgage broker if you are thinking of remortgaging your home. A mortgage is a loan secured against your home.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE

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