Property mortgage valuation was wrong, what can I do?

Question

Hello,

I recently went through the process of buying a property and in order to take out a mortgage my building society commissioned a basic valuation.

But, when it came to moving in I discovered cracks which I now know are caused by subsidence that were covered up by the previous owner during preparations to sell the property.

I have heard that basic mortgage valuations can often miss bigger problems with the house.

Please, please, please can somebody help me? I had no relationship with the surveyors who did the valuation but surely its them I should be challenging?

Answer 1

Strictly speaking, the bottom line is that the mortgage lender's own valuer prepares the report for their benefit, not yours.

Their only concern is whether the property is sufficient for the amount they're being asked to lend on it.

Some lenders, and I include some of the UK's very biggest mortgage lenders (listen to the news if you want to know who i mean) will carry out their valuation from a "drive-by" i.e. the valuer only sees the house from the road.

standard advice is that it's always wise to get a full homebuyers survey when buying.

In the hypothetical Worst Case Scenario, if you were unable to pay your mortgage the lender could reposses your house, and sell it to pay off the money you owe them.  If at that time they learned that the property was not correctly valued then they could claim it from the valuer.

It is possible however that you MAY be able to sue the valuer.  If you acted having relied upon his report, i.e. bought the house based on his incorrect report, then you may have a cause of action.  You should take professional legal advice from a litigation solicitor.

Answer 2

Well, if they(seller) hid Latent Defects they can be liable, check your local laws about LATENT DEFECTS. You may have had a Property Condition Disclosure and if it wasnt listed you are covered...also the Inspector (if an inspection was done ) may be liable if he didn't catch it on his report...do your investigation and proceed. If you would not have bought the prop bc of these defects you may have a case....Keep in  mind that most cracks happen b/c of the building may have "settled"