Mortgage loan to value

[Dancer12345]

Looking to remortgage. How does a bank work out loan to value? I realise it’s how much you want to borrow divided by the value of the house, but how do they find out the current value of the house?

Obviously I know what I paid for the house a few years ago, but Zoopla estimates that the value is higher than this (and I actually paid quite a few thousand less than what the house was originally marketed for).

Do banks have their own system for working out a house’s value? Thanks.

When we remortgaged a few years ago to get a better rate they sent a surveyor round to do a cursory look. We told them what we thought and the surveyor just confirmed that it was fine. I think they use a combination of market data like Zoopla and then just check it's not obviously falling to pieces.

Thanks trilbydoll. Lower loan to value = lower interest rate so hoping to fall into a lower band! Did you have to push for a surveyor or is this common practice?

Most lenders will offer a free valuation for mortgage purposes and send someone on site unless they already have enough data on systems. If you know which lender you're going to, you can check their lending criteria on their website. You will generally find more information if you search through their intermediary website (the one for brokers - usually called 'name of lender for intermediaries'.

Also to add that even if you have to pay a small fee to have a basic valuation carried out, it could be worth it to end up in a lower LTV band

We remortgaged £25000 on a house worth £175000 with TSB and they sent a surveyor our

We had this recently
I said what I thought ours was worth to our new lender and they sent around a valuer to do a drive-by confirmation. He then called me as our property isn't like any others and said he couldn't do it kerbside and would need to come in to view it properly. He upgraded the value significantly (but we were already at 50% ltv so didn't help us get a better rate!)

Thanks everyone, sounds like it’s a pretty common thing for someone to come out then. That’s great! Hoping to fall into 0-65% LTV so it would make a difference.

Pez82 That’s worth bearing in mind, thanks.

If you're remortgaging with the same bank, they won't always send someone out. We've done it twice with ours to improve the rate and they haven't bothered either time just confirmed our value assessment matched theirs over the phone. So our bank must have some sort of value index available.

They'll either ask for a re-valuation and send a surveyor or work from a desk based valuation either requested from a surveying firm or their own internal team depending on the Provider.

QuantumWeatherButterfly how did you got your value assessment? Was that from getting your own surveyor round? I’m possibly sticking with same bank.

PlugUgly1980 Thanks

We stayed with the same bank and they used desktop valuation... it was santander if that helps.

If you're staying with the same bank it isn't a remortgage but an internal transfer (or product switch) and in that case you'll most likely have to pay for a valuation - unless you're happy with their number.
If your rate is coming to an end soon (in next 3 months) you can probably already view the rates they would offer you as an existing customer which will be based on your current estimated LTV.

We changed to a different bank that we never used for anything before, we had just done a big extension and half way through refurbishing.
We were worried they wouldn't allow the remortgage but they just did everything without any documentation or evidence. We had moved from the 80% to the 60% bracket due to the works and due to house price increases.

Thanks everyone. Got an appointment with my current provider next week so will see what they can offer then shop around!