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Original poster

Buyer having second survey done

37 replies

LoyalGuide · 02/05/2024 13:33

Hi all,
I viewed a house I liked about 4 months ago but another buyer made an offer before I could and it was accepted. I moved on.

Recently, I saw a different house on the same street (but it's too small grrr) and I noticed that the house I viewed previously still had its sale sign outside. As I was walking back to my car, I saw the seller/owner come out and as I walked past I said hello and just told him I had just been to view his neighbour's house, and that I had actually seen his house a few months earlier. He seemed to stop to talk, so I just congratulated him on getting a buyer and asked if he was near completion.

I didn't expect him to tell me that he was feeling frustrated with his buyer and that apparently his buyer "couldn't get the money he needed", and another bank survey is being done. He said it's all up in the air but they should know for sure in about 1-2 weeks.

I said, sorry to hear that and hope it goes ok, then politely left after a bit of small talk.

Anyways, I started wondering if maybe this first house might come back to market. I called the estate agent who marketed it to let me know if it does. The agent seemed annoyed (no idea why but they were a bit short and rude tbh!). The estate agent said that everything is going fine with that purchase and the buyer and vendor are hoping to exchange soon and they aren't allowed to share details about it. This is completely different to what the seller actually told me.

Anyways, does anyone have an idea why a "second bank survey" might be done? I wondered if it was a new lender the buyer went to? Or, do banks normally do second surveys if they've already told you they won't you all the money? Bit new to this.

Please tell me if I'm reading too much into this? Thanks!

OP posts:
DontPlayInMySandbox · 02/05/2024 13:35

Usually a problem with value of property or affordability if its bank and not structural.

Original poster
LoyalGuide · 02/05/2024 13:43

thanks @DontPlayInMySandbox ! do banks normally do a second survey if they've already said they won't lend the money to you? or maybe the buyer tried another lender, I don't have experience with this

OP posts:
Sanch1 · 02/05/2024 13:46

Maybe that they couldnt get a mortgage offer from the first lender so they have moved onto another lender, so its not a second survey from the same lender, but a second time that 'a bank' has done a survey but a different one.

Original poster
LoyalGuide · 02/05/2024 13:48

thanks @Sanch1 - how long does the bank's decision to lend take once a survey is done by them?
also, would most banks value the property pretty much the same?
I'm just trying to make a guess at the likelihood of it falling through

OP posts:
Sanch1 · 02/05/2024 13:50

That is a how long is a piece of string type question!

Original poster
LoyalGuide · 02/05/2024 13:51

Sanch1 · 02/05/2024 13:50

That is a how long is a piece of string type question!

haha fair enough.

OP posts:
WhereIsMyLight · 02/05/2024 13:51

The bank had to do a second survey on our property. Our buyer had lost their buyer. Their second buyer’s mortgage valuation down-valued their home from the original valuation so they needed to change their mortgage offer. The bank did a second valuation on our property due to the change in market. It all went through though (eventually) so I wouldn’t get your hopes up too high.

Original poster
LoyalGuide · 02/05/2024 13:53

@WhereIsMyLight thanks! this is a small change. the buyer is chain free and the seller is too. no one else in the chain. not sure if that would make a difference

OP posts:
Twiglets1 · 02/05/2024 13:54

My guess would be that the buyer had a valuation survey via their lender which valued the property too low for them to get the mortgage they need on it to meet the agreed price.

When this happens people sometimes make a second mortgage application through a different lender in the hope that their valuer will value the property higher. This can happen as valuating a property is not an exact science and can be somewhat subjective.

Don't know how long this could take. In your situation, seeing as the EA was unhelpful, I would put a note through the seller's door, telling them you are interested in their property if the sale falls through. However, if 2 different lenders have valued it lower than the sold price, maybe the price does need to be reduced going forward.

WhereIsMyLight · 02/05/2024 13:59

The problem will be if the bank valuations are not stacking up to the asking price, the buyer will have to find the “extra” or negotiate the price down. If the seller thinks there’s still additional interest (you because of your interaction and the estate agent passes this information on), the seller might not negotiate down. The buyer can’t find the extra to make up the sale so the sale falls through. You then do put an offer in, you’ll run into the same problems of a lender’s valuation not matching what the seller wants.

If it comes back online, be ready with a AIP and to ask what the valuations came back at. However, keep looking for houses in the mean time.

Original poster
LoyalGuide · 02/05/2024 15:31

Thanks @WhereIsMyLight and everyone else! Sound advise and will try not to get my hopes up.

OP posts:
Original poster
LoyalGuide · 02/05/2024 15:38

I still have no idea why the estate agent was being rude about it. I didn't tell them I spoke to the vendor at all, just said to let us know if it comes back to market, but they were very much saying, "the exchange date is being discussed now, this property should be regarded as gone now".

OP posts:
Twiglets1 · 02/05/2024 16:06

LoyalGuide · 02/05/2024 15:38

I still have no idea why the estate agent was being rude about it. I didn't tell them I spoke to the vendor at all, just said to let us know if it comes back to market, but they were very much saying, "the exchange date is being discussed now, this property should be regarded as gone now".

Probably just incompetent.

A good EA would have taken all your details so as to have a plan B for their client in the event of this sale falling through.

LIZS · 02/05/2024 16:28

If it is a different lender then they will want another valuation survey.

MrsCarson · 02/05/2024 16:53

Seeing the EA was so rude about it, I'd stick a note through the door, saying you viewed previously and you had spoken when viewing another house on the street and would like to let them know if it does come back to the market to let you know as you are still very interested Thanks.
It's worth a try.

LadyTiredWinterBottom2 · 02/05/2024 17:51

LoyalGuide · 02/05/2024 15:38

I still have no idea why the estate agent was being rude about it. I didn't tell them I spoke to the vendor at all, just said to let us know if it comes back to market, but they were very much saying, "the exchange date is being discussed now, this property should be regarded as gone now".

Because they don't know you and as far as they know the sale is going ahead. You could jeopardise a perfectly good sale.

The owner may have exaggerated the position.

BellsAndFootfalls · 02/05/2024 18:08

We did this, we had an offer accepted and proceeded with a mortgage application with the lender who gave us our AIP. They went round and did the survey. Then we realised we could get a better mortgage from a different lender, so they did a survey too. We ended up getting a mortgage from the second lender and withdrawing from the first application. Both bank surveys agreed with the price we offered.

BellsAndFootfalls · 02/05/2024 18:10

Oh sorry, just realised the seller said the buyer can't get the funds they need to buy, not the same scenario!!

catswithbowties · 03/05/2024 22:35

We had an offer of £480k accepted, then the lender we had an agreement in principle with downvalued to £450k (desk valuation). We wouldn't have been able to make the rest up in our deposit, nor did we want to, and applied to a second lender for a second opinion. They did an in-person survey and valued at £475k, so we renegotiated with the sellers to £475k. Luckily that was only a small drop for them so not a huge sacrifice.

So I wouldn't be surprised if the buyer is in a similar position and the seller is not keen on the idea of potentially having to accept a lower offer, depending on how the property is being valued. But in our case, if our sellers refused to budge on price, they'd just be getting the same problem with other buyers who needed mortgages while hoping someone could and would stump up enough via the deposit.

Original poster
LoyalGuide · 05/05/2024 10:17

thanks @catswithbowties !
When the first lender down-valued to £450k, did you tell the seller? How did they take it? And how quickly did you get the second lender to value the house for you?

OP posts:
Original poster
LoyalGuide · 05/05/2024 10:28

Hi all! Just an update and another question:

The Estate agent called me for feedback on the second property I went to see. It was a different person to the rude one I mentioned above and they were a bit more forthcoming. He said the seller is still proceeding for the exchange and that the seller has signed his side of the contracts. He also mentioned they are waiting to hear back from the buyer. That's all he could tell me.

So, just wondering: how does exchange of contracts work? I thought it was odd that the seller has signed it but they're waiting to hear back from the buyer. What are they waiting on? Just the new lender's valuation?

thanks all!

OP posts:
catswithbowties · 05/05/2024 10:39

LoyalGuide · 05/05/2024 10:17

thanks @catswithbowties !
When the first lender down-valued to £450k, did you tell the seller? How did they take it? And how quickly did you get the second lender to value the house for you?

We did tell the seller as soon as we got the down valuation as we wanted to be upfront that the likelihood is that we will need to renegotiate since we had no extra cash to bump up our deposit. We did say however that we weren't expecting to drop to £450k, and that we would apply to a second lender before suggesting a new offer. They were understandably shocked but agreed to wait for the second lender's valuation, though I think at first they might have thought we were trying it on because they asked us for proof of the £450k valuation! As lenders don't provide their valuation reports, our mortgage advisor confirmed with our sellers' estate agent via email that this is what the first lender valued at.

We applied to a second lender right after we got the first one's valuation. I just checked my emails and realise I got a bit muddled - the second lender didn't do anything in-person survey either and came back very quickly with their desk valuation for £475k, so we managed to agree the new price at £475k within the same week of the first lender's valuation. The in-person survey was actually done by a third lender, who our mortgage advisor applied to because of dropping rates, luckily they also valued at £475k so we had no issues.

Original poster
LoyalGuide · 05/05/2024 10:43

Congrats @catswithbowties what a nightmare though!
How did you get a second valuation so quickly? You said it happened within the same week. I thought you have to apply for the mortgage all over again via the second lender and they come to value the house a few weeks later?

sorry, I'm a bit inexperienced with this.

I also wrote above an update:
I spoke to a different person from the estate agency to the rude one I mentioned above and they were a bit more forthcoming. He said the seller is still proceeding for the exchange and that the seller has signed his side of the contracts. He also mentioned they are waiting to hear back from the buyer. That's all he could tell me.

So, just wondering: how does exchange of contracts work? I thought it was odd that the seller has signed it but they're waiting to hear back from the buyer. What are they waiting on? Just the new lender's valuation?

I just don't know if this buyer is having an affordability issue or if the problem is the house valuation though (like your experience).

OP posts:
catswithbowties · 05/05/2024 10:47

LoyalGuide · 05/05/2024 10:28

Hi all! Just an update and another question:

The Estate agent called me for feedback on the second property I went to see. It was a different person to the rude one I mentioned above and they were a bit more forthcoming. He said the seller is still proceeding for the exchange and that the seller has signed his side of the contracts. He also mentioned they are waiting to hear back from the buyer. That's all he could tell me.

So, just wondering: how does exchange of contracts work? I thought it was odd that the seller has signed it but they're waiting to hear back from the buyer. What are they waiting on? Just the new lender's valuation?

thanks all!

Edited

I suspect what the EA means is that they are waiting for the buyer to also sign the contract and return to their solicitor. Once that is done, they are ready to exchange. Exchange happens when both seller and buyer have given explicit authority to exchange the signed contracts on the day, at which point usually the solicitors ring each other up and verbally "exchange". A deposit (usually 10%) of the total sale price is transferred from the buyer to the seller via the solicitors as part of the commitment to purchase.

I'm afraid if the seller has signed and they are just waiting for the buyer to sign, they seem pretty close to exchanging. Until they have exchanged, either side can still pull out of the sale with no real repercussions, but imo it seems the seller was just grumbling and doesn't seem upset enough with the buyer to pull out. It's disappointing I know, but I would probably give up on this one OP, you've already mentioned to the EA already you'd be interested if things fall through and that's all you can do really!

catswithbowties · 05/05/2024 10:52

LoyalGuide · 05/05/2024 10:43

Congrats @catswithbowties what a nightmare though!
How did you get a second valuation so quickly? You said it happened within the same week. I thought you have to apply for the mortgage all over again via the second lender and they come to value the house a few weeks later?

sorry, I'm a bit inexperienced with this.

I also wrote above an update:
I spoke to a different person from the estate agency to the rude one I mentioned above and they were a bit more forthcoming. He said the seller is still proceeding for the exchange and that the seller has signed his side of the contracts. He also mentioned they are waiting to hear back from the buyer. That's all he could tell me.

So, just wondering: how does exchange of contracts work? I thought it was odd that the seller has signed it but they're waiting to hear back from the buyer. What are they waiting on? Just the new lender's valuation?

I just don't know if this buyer is having an affordability issue or if the problem is the house valuation though (like your experience).

Edited

Desk valuations are done by online research, so lenders can give a valuation much more quickly that way. It's based on things like the type of build the property is, other sale prices of properties in the area etc, so really it's an educated guess on their part. The second lender was a major bank so assume they have a lot of researchers who do this day in, day out! I would credit our excellent mortgage advisor on the speed of getting a second application in, and to be fair we found out about the second valuation "informally" so it wasn't that they'd sent us a letter to confirm the offer to lend at this point, our mortgage advisor rang us up to give us the new valuation figure after having called the lender for an update on the application.