LVR Methodology

Hi folks,

I have been sniffing around these forums for quite some time and found the multitude of conversations/discussions to be very interesting and beneficial. 1 have 1 PPOR and 2 IP in Melbourne (apartment in Ascot Vale and house in Greensborough).

Although there have been numerous questions/answers regarding calculation of LVR, I I have a question that i don't believe has been addressed - but happy to be corrected. When calculating LVR, do you use a formal valuation by your bank or independant professional valuation (organised by yourself) or your own perceived valuation? What is the standard methodology??
 
r u trying to work it out for your own knowledge or to lodge an application with a bank.

If it is for a lender they will want to use one of their own valuers
 
I use my own valuer, and I get the banks to accept that valuation instead of the banks valuer as usually they are too conservative!

Big Tone
(the original)
 
Even if you submit an independent valuation the other valuer could be off by up to 10%! Bear in mind that Banks now insist on their own valuers and some will not entertain any valuations outside of their panel.

I think far too much is on managing valuers. The better way to get better valuations by buying better. I tend to buy 10-20% under market....I use the same tools as the valuers....i.e. talking to agents, RP data. I also let the bank know I am well researched.



Hi folks,

I have been sniffing around these forums for quite some time and found the multitude of conversations/discussions to be very interesting and beneficial. 1 have 1 PPOR and 2 IP in Melbourne (apartment in Ascot Vale and house in Greensborough).

Although there have been numerous questions/answers regarding calculation of LVR, I I have a question that i don't believe has been addressed - but happy to be corrected. When calculating LVR, do you use a formal valuation by your bank or independant professional valuation (organised by yourself) or your own perceived valuation? What is the standard methodology??
 
Hi folks,

I have been sniffing around these forums for quite some time and found the multitude of conversations/discussions to be very interesting and beneficial. 1 have 1 PPOR and 2 IP in Melbourne (apartment in Ascot Vale and house in Greensborough).

Although there have been numerous questions/answers regarding calculation of LVR, I I have a question that i don't believe has been addressed - but happy to be corrected. When calculating LVR, do you use a formal valuation by your bank or independant professional valuation (organised by yourself) or your own perceived valuation? What is the standard methodology??

I calculate my LVR's ever week. I like to see how we're doing.

Of course; it's all based on recent sales of similar properties in the same areas.

For example; we have a 2x1 unit in Central Frankston. I look at what has sold around it recently on re.com.au.

Now, today there is no property similar to ours for sale in our area, and the recent ones went for $225k as the cheapest one. This tells me that mine is probably worth $225k (worst case scenario).

The valuers do a similar thing, but theirs is an official figure which the Banks will accept. Mine isn't; it's anecdotal by me and for me.

But, if you are monitoring the market you can pre-empt them to a degree.
 
I use my own valuer, and I get the banks to accept that valuation instead of the banks valuer as usually they are too conservative!

Big Tone
(the original)

Is your valuer on your lenders valuer panel? If not, I'd love to know how you convince your lender to go with your valuer.

When ever I want an independent valuation I use my own valuer that just so happens to be on my lenders valuer panel.
 
Is your valuer on your lenders valuer panel? If not, I'd love to know how you convince your lender to go with your valuer.

When ever I want an independent valuation I use my own valuer that just so happens to be on my lenders valuer panel.
Am I wrong in presuming that if you find a valuer who is on your lenders panel (I have), you engage them to value your property and provide them with current sales of comparable properties so as to get the most up to date valuation you can present that valuation to your lender and they are likely to accept it?
Has anyone done this?
 
Hi Rick, it works with some lenders, others it doesn't. You're probably okay to do this with some lenders as they do use a specific lender for a specific location.

Other lenders have up to 3 valuers in a location and choose one at random. If you guess wrong, you're out of luck.

Several lenders will allow brokers to order valuations upfront, before lodging the application. In other instances, if you give a valuer a recent valuation you've had done yourself (even if they're not from the same valuation company) they may take the easy way and copy it.
 
My lender book sin "official" valuations. I personally keep track of three sets of LVR and values.

Valuation Value: As per bank based on last valuation.
Conservative Value: If I had to sell it quickly, this is what it would go for...
Strong Value: If someone really wanted it. The strong value has replaced the conservative value a few times along the way :) , and vice versa too...:(

From this, I work out LVR...
 
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