Down valued by lender - now what

[Happyhouse89]

I am wondering if anyone can offer their view on this situation, just in case there are things we haven't considered.
Offered on property, great location, potential to extend and progress from our first time buy purchase, new project. Had offer accepted lower than asking price, which started 'as offers in excess of'. Less £10k under so nothing majorly significant. Purchase House is in region of £360k .
We have only put ours on market and SSTC to buy this specific house else we'd stay put for now.
We have accepted offer which leaves us approx £200k equity.
Lender has come back valuing purchase House at £330k... for that price range £30k is significant difference I feel.
Mortgage advisor is very against us attempting renegotiation and suggested we pay £2k cash to stay in the same LTV band and get same interest rate, else we'd have to go up on interest rate over 5 years which would cost more than £2k.
We can afford the £2k cash but I'm worried about taking out the extra considering the work that needs doing.
I had the feeling mortgage advisor and EA was against renegotiation just to keep the status quo and progress things.
If we renegotiate we risk losing out completely?! That said we were only people that offered. House was on for a week with a few viewings.
WWYU?

Have you been back to the seller?

can you make it a bit clearer?

Market price / Valuation / deposit etc

You could try a different lender to get another valuation opinion. £30k is quite a lot under.

@Threetulips sorry, do you mean clearer to the seller? Or you'd like more info?
We haven't gone back to seller yet. The valuation only came back this afternoon. Mortgage broker was against renegotiation and just seemed to minimise it as if it was nothing. Spoke to one estate agent who seemed to give the impression it was hassle for them but would ask the guy we usually deal with to call me tomorrow.
We did feel house was at high end given what else has been for sale on street recently but in addition to that our house has gone for £25k more than when it was valued 6 months ago so we figured it balanced out and was a sign of the market. House we're selling hasn't been downvalued.

We are waiting for a mortgage valuation to come back. Our mortgage advisor pre warned us that he is seeing more down valuations at the moment. We are limited on our LTV so if the valuation doesn’t match the sale price then we will need to pull out, we don’t have the extra catch to cover a shortfall . If you have the cash to bridge the gap then I guess only you know if the house is worth it.

Nightmare isn't it! Apparently lenders are being very slow in their valuations at the moment too which doesn't help.
I had read about it happening, didn't expect it to be us and such a huge difference - I doubt the seller will budge sadly 😔 Fingers crossed yours goes smonthly.

Yes it’s been two weeks since the valuation and still no news

Given that you only put yours up for sale for this specifc house I'd be tempted to speak to the vendor. I'd tell them what the survey came back with - is there anything they can do to the house that came up on the survey which might make your more comfortable?

I'd be reluctant to go that far over value currently as things appear to be starting to drop. Would the seller achieve that price if they were starting again? Looks unlikely if you were the only offer...

Are you ready to proceed apart from that? Is your buyer/chain? If you're ready to go then I'd be tempted to discuss proce reduction in line e with survey and be prepared to meet half way perhaps. But 8/9% is a high gap...

That said I'm not in the market currently and have no idea of expectations!

Although it's a long time ago now this happened to us when we purchased the property we are in now.
Slightly different in that it had been on the market a little while, but when the valuation came in at 25k under what we offered (which was 8k below asking) the EA kind of let slip that this is why previous sales had fallen through.
We simply couldn't afford to stand the extra so I guess our next step was do or die anyway.
We could manage about 5k buffer, so we relayed this to the seller. They were advised that having happened twice, the valuation stage was going to keep throwing this at them. Faced with more failed sales they accepted our offer and we've been here 13 years now.

It's definitely worth at least trying to negotiate a bit, but if you have the wriggle room to afford it and you really want it, then don't play too hardball.

@LittleOwl153 I think that sums up where we're at. Will go back to seller via EA tomorrow and try and renegotiate, though I won't hold my breath. We've got nothing to loose and feel uneasy about there being such a discrepancy when the house needs a lot spending on it...

If the house is in need of a lot of work then this will be a big part of the undervaluation. Refurb costs are ridiculously expensive right now, and project properties are not in demand because of it
Just tell the agent you are reducing your offer to 330k as that is what the valuation says, the seller then has 3 options, accept that, negotiate, or tell you to f right off. If they are sensible they will probably go with option 2

We paid over the valuation amount for ours.

We were intending to stay long term and had offered based on what it was worth to us.A surveyor saying it was worth less didn’t change that.

We’ve lived here almost 10 years now, full refurb and it’s value is now over double what we paid.

Never once regretted paying what was over the odds at the time.

I always like to know the outcome when I read threads like this. So..... an update in case anyone wonders/cares, we renegotiated, ignoring advice from EA and mortgage broker. The risk paid off as we've agreed on a price more than £20k less than initially and MUCH closer to the lenders valuation.

That’s good news! Do you mind me asking what lender that was?

Congratulations

It was Nationwide

We are two weeks down the line from a nationwide valuation and still haven’t had a decision

I had an initial £35k downvaluation on the property I am currently buying. There is nothing else on the market and asking prices are going up and up. My deposit is 15%, so I don't really have a huge amount to do play with.

I paid to have a second mortgage valuation survey, and the second one came in at £20k lower than the agreed price.

I proposed to my vendor that I would have to lower the agreed price to the valuation, they counter offered for us to meet halfway.

As such, I'm paying £10k over the mortgage valuation, and they are accepting £10k under what we originally agreed, so it's worth starting a negotiation.

I wouldn’t buy property for more than the bank is valuing it. It’s everyones choice of course. And 100% would feed this back and ask for price adjustment.

Honestly, banks are not stupid. People, as history shows, can be. Especially led by desperation that we will run out of the houses lol