will the bank offer the mortgage now that our property has been undervalued?

[vannah]

Im back again!
Its not our survey that we had done thats now in question, but the one that our buyers had done on our flat a few days ago...

The survey was done on thursday of last week, and on friday morning, my estate agent called me to say that the surveyor had undervalued our flat by £3000. That to us is ok, as we are pretty much desperate for this sale so 3k is not too alarming and we can just afford that drop. We are worried that the bank will look unkindly on the reason why it was undervalued: our bedroom extention was not done (by previous owners) according to buildings regulations. ie its timber and the walls are thin.

But what happens now? Will the bank now refuse to give our (first time) buyers a mortgage on account of a fault like this?

Their bank is Abbey. Theyve been painfully slow up until now, took ages for the survey to be organised due to a 'backlog' in applications.

When will we know what the bank has decided for our buyers? DH and I are besides ourselves with worry as our vendor of the lovely property we are trying to purchase is threatening us to move fast as he has another buyer...

any advice so very appreciated..
thanks

Sorry, I don't know but am bumping thread for you - good luck

thanks nyx..

I got my mortgage as a first time buyer with Abbey and had a similar thing in that the house we were buying was undervalued by 4k because of some damp (which cost £1k to fix!). The vendor dropper the price by 4k and abbey took about 3 weeks to redo our apllication. And we wer eon the phone to them constantly at least once a day as wanted the sale fast.

The reason they toopk so long is that they re-did the whole contract to include a few other caveats related to the sale that were more related to our finacial situation (we couldn't hold the property in trust for someone who lent us some cash for a deposit) rather than the house, so it may be quicker for your buyers.

HTH, oh and we bought out house about 4 weeks ago!

many thanks navyeyelash, very useful. Do you think that if you hadnt had the other factors relating to your financial situation it would have been smoother?
Im trying to figure out whether or not Abbey is being generally slow at the moment..

I assume it would have been sooner as all they would have had to do is change the ammount we were borrowing.

Abbey were really slow when we bought because they had loads of buyers due to the fact they have the best products at the mo but have also laid off staff. My solicitor had a few other buyers using them and said it was across the board. Sorry!

oh dear...
thanks again

Hi Vannah - a down valuation could affect their mortgage offer. Most likely reason would be their loan to value figure. Do you know if they were trying to borrow 80% or 90% of the cost of the flat?

When a property is down valued this is the most obviously affected thing. Just reread yr op and it sounds like you will reduce the price by £3k (usually the buyer justs puts up with it). Either way one of the most important factors in agreeing mortgage lending at the moment is loan to value. Presumably the Abbey will be happy they could afford the mortgage if they've got this far.

Unfortunately you are at the mercy of your buyers chasing Abbey almost daily before you find out the answer. There is a possibility that Abbey may refuse to mortgage if they think the flat would be unsellable in the event of reposession because of the failure to follow building regs.

Was the survey done for Abbey's benefit or did the buyer get a full survey done for them? If it's the latter the surveyor would inform the buyers not to purchase if they thought it was that big a deal - doesn't sound like that's happened.

Good luck

thanks silkcushion, really useful to read your reply, will be showing it to DH later. Im not entirely sure what kind of a survey they had done, the guy was definately from abbey and our estate agents said it was a HB report...