When someone applies for a mortgage on a property, the lender will arrange a mortgage valuation to check whether that property’s value is sufficient to cover the loan requested by the applicant.
A mortgage valuation is based on a limited visual inspection of a property by a regulated RICS Registered Valuer. The inspection typically takes around 20 to 30 minutes, although there is significant additional research carried out before and after the site visit.
Many, but not all lenders provide a copy of the valuation report to their loan applicant as a courtesy. The valuation is however only for the lender’s purposes and should not be relied upon by anyone else.
The seller in a property sale transaction will not receive a copy of the mortgage valuation report.
Advise the lender of the property’s value for mortgage purposes
Highlight any issues or defects which are considered significant enough to affect the value or cause concern for the lender
Help the lender to decide if the property is suitable security for the loan that the applicant has applied for
Help the lender assess their risk of suffering a loss if the property is repossessed and sold
For the seller, by an estate agent, not legally binding, speculative.
The lender only.
For the lender, by an RICS registered valuer, legally binding, evidence-based.
All of our surveyors have studied for several years to attain accreditation from the Royal Institution of Chartered Surveyors (RICS)
All of our surveyors are RICS Registered Valuers and must follow the global standards set out in the RICS Valuation Standards (Red Book).
All of our surveyors are audited by our lender clients and the Royal Institution of Chartered Surveyors (RICS).
All of our surveyors have detailed knowledge of the local area and have been allocated an approved geographical area of operation in accordance with the lender’s requirements.
We have over 30 years of experience in residential property surveying and valuation.
We carry out 178,000 valuations per year on behalf of most major lenders in the UK. We are one of the UK’s largest surveying and panel management companies.
Our lender clients are generally very happy with the service that we provide, and we receive regular positive feedback from them.
If the surveyor’s mortgage valuation is less than the applicant’s expectation, then some people outside of the valuation profession may call this a ‘down valuation’. In this instance a mortgage might only proceed if the applicant has the extra funding to make up the difference.
However, in reality this should not be called a ‘down-valuation’. What is being described here is the difference between the application estimate or agreed purchase price (which reflects what the seller and buyer have agreed the property is worth to them) and the market value (which is based on comparable evidence from other recent transactions on similar properties in the area).
Valuations can be challenging when house prices and transaction levels are falling or rising at a faster rate than usual. When the market is like this, surveyors can sometimes be perceived as being too cautious.
Many assume that when surveyors provide valuations which are lower than expected, they are just trying to avoid negative consequences from the lender clients. This is not the case. The surveyor’s principal aim is to provide an accurate valuation based on current market conditions and to fulfill the legal terms of their instruction.
However, it is important to recognise that in most circumstances SDL’s client is the bank or building society. It is not the seller, or even the person taking the mortgage.
If a valuation fee is charged, this is the applicant’s contribution to the cost of the lender obtaining a valuation service from SDL for the lender’s own purposes and is not an implied contract between mortgage applicant and SDL.
The lender is asking SDL Surveying to provide them with our opinion of the market value of the property to assess their lending risk, and to help safeguard themselves from any loss that may be incurred if they lend too much against an individual property.