Most of us, when buying a property, will need a mortgage. The Mortgage lender will require an independent valuation of the property to make a decision to lend. This mortgage valuation report is generally commissioned by the buyer or the buyer’s mortgage provider, prior to exchange of contracts (release of offer) to purchase a property.
The mortgage valuation report is paid for by you, the borrower, but it’s usually solely for the benefit of the mortgage provider although sometimes it can also be for the benefit of the borrower. The lender will have certain minimum requirements in terms of Loan to Value Ratio and the report will confirm that the property is of sufficient value to meet these criteria. The report may not necessarily value the property at the purchase price and if the loan to value ratio is still met, it doesn’t have to.
If you do not need a mortgage, there is no requirement upon you to have a valuation or survey but, given the sums involved, a valuation survey of some sort undertaken by a qualified independent RICS Chartered Surveyor third party would be prudent.
It’s important to know that a valuation report is a basic open market valuation of the property and, whilst it will comment on the general condition of the property, it will not highlight if there are structural issues with the property and if you have any concerns a full survey must be undertaken by a suitably qualified Chartered Surveyor, it is not a Building Survey.
When purchasing an older property it may therefore be worthwhile commissioning your own more detailed valuation survey (ideally undertaken by the same ‘panel valuer’ at the same time as the inspection for the valuation) or a full structural report. You should also make sure that this report is acceptable to the lender and may also be relied upon by you, the purchaser.
For more information, Contact Mortgage Required on 01628 507477 for some initial advice.
See our Valuations and Surveys page for more details.
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