The bank won't lend us as much as we thought, but the seller won't reduce the price. What are our options?
My husband and I are buying our first home. We found a home we really liked, made an offer and managed to agree a below-asking price. The estate agent even told us he thought we were getting a good deal.
We first tried to negotiate the seller down based on the valuation but they are not playing ball. The estate agent suggested we try our luck with a different mortgage lender, who might use a different valuer. How are mortgage valuations done? The asking price in your case may have been set by an overly optimistic seller or by an estate agent looking to win the instruction by promising a higher selling price than the competition.
Is it a risk? Our reader has received a down valuation, the seller won't reduce the price - and they are worried about overpaying in a market in which house prices have fallen since 2022 Remember, the seller should also be concerned this will happen again were they to try and sell to someone else. Alternatively, a buyer may prefer to make a new mortgage application with a different lender, in the hope that the new valuation may offer a different result.
So if there are very few sales of the type of property you are trying to buy in that particular location, this could have an impact on the valuer's assessment.Should they try to renegotiate with the seller?Jeremy Leaf replies: Much of the answer to this question is market-driven, because it also comes down to whether the seller is prepared to renegotiate the price.
Should they use their savings to pay the shortfall?Ravesh Patel replies: Whether you should use savings to make up the shortfall to buy the property depends on your attitude to risk. Should they query the valuation?Jeremy Leaf replies: Assuming you wish to pursue this purchase and feel it is a fair price, try asking your lender what the basis of the valuation is.
It's worth nothing that just because a property is marked as sold on Rightmove or Zoopla for a higher price, it does not necessary mean it's definitely sold - as it can fall through later.
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