What is a property valuation?
A property valuation is the process of acquiring information involving the construction and physical characteristics of the property, the size and any issues that may be involved. Data collated from comparative sales within the area also considered when determining the value of the property.
This is completed to determine the value of the property and security against the home loan. Should the bank need to sell the home due to specific reasons then it has the capacity to recover the outstanding amount owing following the valuation undertaken initially.
When is a valuation needed?
A property valuation is required when you are using a lender to finance the purchased property. This is to ensure that the lender is not providing more than the actual value of the property.
Bank valuations are also be used for refinance and also accessing equity in your home.
Who orders a valuation?
Your Mortgage broker will order and arrange the valuation for you. If it is a valuation on your own home, you may be required to be in attendance to let the valuer through the property.
How much do valuations cost?
Property valuation costs can differ between banks to independent valuers and the location of the property will also influence the cost, example rural to city.
Mortgage Brokers may or may not forward costs on to you when a valuation is requested depending on the lender institution.
Can I use one valuation with multiple banks?
If the valuation returns with an unfavourable outcome then you are entitled to seek an alternative valuation through another institution. It isn’t uncommon for valuers to report differing opinions so requesting another valuation is at your prerogative.
What happens if the valuation is less than what I paid for the property?
Should a bank valuation come in less than what the property was purchased at then you may have a problem in acquiring the initial borrowing amount you applied for. This does happen from time to time and it is up to the borrower to find money elsewhere or the entire home loan may be rejected entirely.
Can I dispute a valuation result?
Disputing a valuer’s report can be conducted by providing evidence of similar property sales within the area.