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Thread: Remortgage question...

  1. #1
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    Remortgage question...

    We are going through our first re-mortgage in the next 2 months. On our estate none of the houses the same as ours have sold since we bought ours almost 2 years ago. Zoopla valuations seem a bit inflated! Of the 6 houses like ours, ours has the lowest valuation. I know zoopla is very rough and can be wildly inaccurate.

    With no similar properties selling how would our house be valued? Be gentle this is my first time going through this.

    Stu

  2. #2
    Grand Master Chris_in_the_UK's Avatar
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    Whoever you are remortgaging through will have a 'surveyor' on their books who will inspect the property. When they land, show them around and make good the features of the house. Estate agent valuations are not really indicative of what mortgage lenders value at.
    When you look long into an abyss, the abyss looks long into you.........

  3. #3
    Craftsman r.dawson's Avatar
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    I think valuations are taking place but if it's a relative new build they will do a desk valuation. Zoopla was £12k out (over) when we did it last March

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  4. #4
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    Quote Originally Posted by r.dawson View Post
    I think valuations are taking place but if it's a relative new build they will do a desk valuation. Zoopla was £12k out (over) when we did it last March

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    Iíd heard it would most likely be a desktop valuation Iím just not sure how they would do it and what info they would use to base the value on.

  5. #5
    Craftsman r.dawson's Avatar
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    Quote Originally Posted by Stuno1 View Post
    Iíd heard it would most likely be a desktop valuation Iím just not sure how they would do it and what info they would use to base the value on.
    How old is the property?

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  6. #6
    Grand Master Chris_in_the_UK's Avatar
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    Quote Originally Posted by Stuno1 View Post
    Iíd heard it would most likely be a desktop valuation Iím just not sure how they would do it and what info they would use to base the value on.
    If that is the case, I suspect they will just go with the average?.
    When you look long into an abyss, the abyss looks long into you.........

  7. #7
    Master Alansmithee's Avatar
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    Quote Originally Posted by Stuno1 View Post
    Iíd heard it would most likely be a desktop valuation Iím just not sure how they would do it and what info they would use to base the value on.
    They might in a rare case drive by but I doubt anyone will come around during lockdown - they will just use a commercial database.

  8. #8
    I had a surveyor come to my property on Monday as the bank wanted a physical valuation.

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  9. #9
    Master Alansmithee's Avatar
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    Quote Originally Posted by oliverte View Post
    I had a surveyor come to my property on Monday as the bank wanted a physical valuation.

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    Well there you go! Before I sacked off my mortgage I never saw one once!

  10. #10
    Zoopla valuations are deliberately wrong. They're designed to make you think "that's too low, let me get an agent around" or "omg if it's worth that much should we move this year instead". The purpose of the valuation given is to get you to contact an agent who are actually their paying customers.

    Oddly Zoopla also own Hometrack which many lenders use for desktop valuations. - HSBC, Barclays, Santander etc. You can buy your own valuation from Hometrack £19.95 so if you're really interested that might be worth the money for you.

  11. #11
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    If you're staying with the same provider then I doubt any sort of valuation will take place. When my fixed rate mortage came to an end I simply renewed online with teh same provider. Literally took all of 5 mins.

  12. #12
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    Ask who the surveyor is, make contact, and tell them what you need the valuation to be.

  13. #13
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    Thank you for all the comments. Feels a bit like the Wild West ...

  14. #14
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    Quote Originally Posted by wileeeeeey View Post
    Zoopla valuations are deliberately wrong. They're designed to make you think "that's too low, let me get an agent around" or "omg if it's worth that much should we move this year instead". The purpose of the valuation given is to get you to contact an agent who are actually their paying customers.

    Oddly Zoopla also own Hometrack which many lenders use for desktop valuations. - HSBC, Barclays, Santander etc. You can buy your own valuation from Hometrack £19.95 so if you're really interested that might be worth the money for you.
    Thank you Iíll do this out of curiosity if nothing else.

    - - - Updated - - -

    Quote Originally Posted by r.dawson View Post
    How old is the property?

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    The house is 12 years old. Does this make a difference?

  15. #15
    Craftsman r.dawson's Avatar
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    Quote Originally Posted by Stuno1 View Post
    Thank you Iíll do this out of curiosity if nothing else.

    - - - Updated - - -



    The house is 12 years old. Does this make a difference?
    If it was an older property, had a big change in valuation or was an abnormal case they would want a physical valuation.

    If it's a relative new build, your case is straight forward (continued employment, no missing payments, etc.) Then even if we weren't in a pandemic they could do a desktop valuation.

    They will give a valuation when they contact you for the remortgage (ours was closer to the Zoopla one from our original lender)

    The only problem it will cause is if the valuation takes you into a different LTV bracket.

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  16. #16
    Quote Originally Posted by Stuno1 View Post
    Iíd heard it would most likely be a desktop valuation Iím just not sure how they would do it and what info they would use to base the value on.
    It will most likely be an area specific house price index applied to whatever/whenever the price was when you bought it.
    Plug your price, date and region into the nationwide one to give you a rough idea of what it's worth now (leave current date as Q4 2020, as that's the newest it can do)

    https://www.nationwide.co.uk/about/h...ice-calculator

  17. #17
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    They will start by looking at how much you want to borrow against the price you paid two years ago. The higher the loan to value ratio, the more likely it is the lender will instruct a valuer, especially if you are looking to borrow more.

  18. #18
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    Quote Originally Posted by wileeeeeey View Post
    Zoopla valuations are deliberately wrong. They're designed to make you think "that's too low, let me get an agent around" or "omg if it's worth that much should we move this year instead". The purpose of the valuation given is to get you to contact an agent who are actually their paying customers.

    Oddly Zoopla also own Hometrack which many lenders use for desktop valuations. - HSBC, Barclays, Santander etc. You can buy your own valuation from Hometrack £19.95 so if you're really interested that might be worth the money for you.
    Cheers for this. It basically used zoopla estimates and provided some examples of properties recently sold and up for sale. If they use this valuation Iíd be very happy!

    - - - Updated - - -

    Quote Originally Posted by Brighty View Post
    It will most likely be an area specific house price index applied to whatever/whenever the price was when you bought it.
    Plug your price, date and region into the nationwide one to give you a rough idea of what it's worth now (leave current date as Q4 2020, as that's the newest it can do)

    https://www.nationwide.co.uk/about/h...ice-calculator
    Ta. This is useful too.

  19. #19
    Grand Master RustyBin5's Avatar
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    Why are you remortgaging? Is it for a better rate or are you looking to borrow more?

    9 times out of 10 you would be cheaper asking your EXISTING lender for a replacement rate (or for a further advance if you are seeking additional borrowing). One benefit of this is that they are likely to to a Ďdesktopí valuation rather than instructing a surveyor to conduct a new one. This is usually less problematic and faster.

  20. #20
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    I have remortgaged multiple times over the years and never experienced a better rate from my existing provider. Although, I do agree that switching to new rate and product with the Existing lender is often easier.

    OP - in your case, I am not sure what your concerns are regarding the remortgage, but valuations usually become important when you are looking to borrow more money or when you are close to LTV band change.

    My advice would be to speak to a mortgage broker that deals with the whole market, often they have access to better rates than individuals can obtain going directly to their banks.

    Zooplaís valuation estimates are based on a number of variables, including the last price paid and then adjusting that for markets changes since then. Yes it will give you a number, but the degree of accuracy will alway be questionable as itís a very general tool.

    A valuer would look for comparable houses in your very local area and if there is no comparibles, then the valuation will have an even higher level of subjectivity than it has already. They would also look at the price you bought it for (assuming this was 2yrs ago) and unless you have made any significant changes, they would apply the local market changes to the price, in a similar way to zooplaís estimate.

    You could also look at it this way, if you were buying the house today with fresh eyes, what would you pay for it? And for that money that comes to mind, could you find a better house?

  21. #21
    Master MakeColdplayHistory's Avatar
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    Quote Originally Posted by Captaincook View Post
    I have remortgaged multiple times over the years and never experienced a better rate from my existing provider. Although, I do agree that switching to new rate and product with the Existing lender is often easier.
    Same here. The last couple of times there hasn't been enough difference though to tempt me to move to a new provider. I guess it's the 'cost of convenience'. They will know what's available from other lenders and have a pretty good idea where they need to set their replacement rates to retain a good proportion of existing customers.

  22. #22
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    Quote Originally Posted by Captaincook View Post
    I have remortgaged multiple times over the years and never experienced a better rate from my existing provider. Although, I do agree that switching to new rate and product with the Existing lender is often easier.

    OP - in your case, I am not sure what your concerns are regarding the remortgage, but valuations usually become important when you are looking to borrow more money or when you are close to LTV band change.

    My advice would be to speak to a mortgage broker that deals with the whole market, often they have access to better rates than individuals can obtain going directly to their banks.

    Zooplaís valuation estimates are based on a number of variables, including the last price paid and then adjusting that for markets changes since then. Yes it will give you a number, but the degree of accuracy will alway be questionable as itís a very general tool.

    A valuer would look for comparable houses in your very local area and if there is no comparibles, then the valuation will have an even higher level of subjectivity than it has already. They would also look at the price you bought it for (assuming this was 2yrs ago) and unless you have made any significant changes, they would apply the local market changes to the price, in a similar way to zooplaís estimate.

    You could also look at it this way, if you were buying the house today with fresh eyes, what would you pay for it? And for that money that comes to mind, could you find a better house?
    Thank you for the reply. I am looking to take a bit of money if possible but donít want to go over a LTV threshold so as to still benefit from a reduced interest rate. I am in touch with a broker and they have me diarised for a call in March. I was just curious to see if I could get an idea of the value of my property to see if my goal was achievable. If zoopla is used and the rough valuation I got from Ďtrack homeí is what lenders may use for a desktop valuation I am more than covered. I guess Iíll find out in March!

  23. #23
    Quote Originally Posted by wileeeeeey View Post
    Zoopla valuations are deliberately wrong. They're designed to make you think "that's too low, let me get an agent around" or "omg if it's worth that much should we move this year instead". The purpose of the valuation given is to get you to contact an agent who are actually their paying customers.

    Oddly Zoopla also own Hometrack which many lenders use for desktop valuations. - HSBC, Barclays, Santander etc. You can buy your own valuation from Hometrack £19.95 so if you're really interested that might be worth the money for you.
    How do you reckon Zoopla decide whether to over or underestimate any particular house?

  24. #24
    Quote Originally Posted by ernestrome View Post
    How do you reckon Zoopla decide whether to over or underestimate any particular house?
    They don't. It's done by out and in code of postcodes and last sale price or closest last sale price on the same out and in code of the same type of property - detached, terrace etc. There used to always be a confidence level and explanation below hut it's a lot more hidden these days.

    Example:
    Price: £750k
    Confidence level: 50%
    "We have given this property a Z-Index valuation of £750k based on a value range of £500k-£1m. Our confidence level is 50%"

    Stuff like that, but really it's just to get you to submit a valuation enquiry to an agent on one of the higher spending tiers or paying for additional valuation products in other postcodes.

    It's not that different than Starbucks putting the wrong name or spelling on a cup. Makes you do something. For Starbucks you take a pic and advertise their 'mistake' all over social media. For Zoopla you speak to an agent about your house price and they have a lead to work on and it validates the monthly fee they pay.

    As I said earlier ZPG also own Hometrack so can give accurate desktop valuations when they want, but charge £20 for this.

  25. #25
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    Quote Originally Posted by Stuno1 View Post
    I am in touch with a broker and they have me diarised for a call in March. I was just curious to see if I could get an idea of the value of my property to see if my goal was achievable. If zoopla is used and the rough valuation I got from Ďtrack homeí is what lenders may use for a desktop valuation I am more than covered. I guess Iíll find out in March!
    I donít know when you will switch to your SVR but given most mortgage offers usually last 6 months, you might be better off starting the process now. This way you will have more time to make a decision, plus if the preferred lender comes back with a lower valuation than expected, you have the time to look at alternate arrangements.

  26. #26
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    Quote Originally Posted by Captaincook View Post
    I donít know when you will switch to your SVR but given most mortgage offers usually last 6 months, you might be better off starting the process now. This way you will have more time to make a decision, plus if the preferred lender comes back with a lower valuation than expected, you have the time to look at alternate arrangements.
    Interesting, I was told this but when I asked my broker he suggested most offers last 3 months.

  27. #27
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    Quote Originally Posted by Captaincook View Post
    My advice would be to speak to a mortgage broker that deals with the whole market, often they have access to better rates than individuals can obtain going directly to their banks.
    I really would second that. When I remortgaged last time around I initially thought I could DIY by dint of careful research, but I went with a friend's recommendation of a broker and would always do that now. I think his fixed fee was something like £500 and he's saved me vastly more than that in the five years since then. He also handled / filled out all the application forms which has to be worth several hundred pounds alone ...

  28. #28
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    Quote Originally Posted by Stuno1 View Post
    Interesting, I was told this but when I asked my broker he suggested most offers last 3 months.
    Most offers these days are valid for 6 months but some are as short as 3 (equity release can be a month or so).

    Depending on your current lender they might be able to offer you a good rate and the additional funds (product transfer & further advance) which will save you the aggro of having to complete a full legal remortgage, involving the incompetent solicitors that lenders include for 'free'. As with the phrase 'no such thing as a free lunch', these will likely cost you hours of time and a nervous breakdown as they really are clowns.

    if your current lender is a bit niche, or not looking after existing clients then a remortgage may well be the best option; just be prepared to be on the front foot with the legal work.

    valuation range from desktop, drive by to physical surveys. If it is a fairly conventional freehold house and a favourable loan ratio they will usually desktop, particularly in the current situation with Covid etc.

    due to the current service standards we usually start the remortgage sourcing and affordability 3 months prior to current rate expiring. Some get offered in days, others take weeks to sort out.

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