Valuations

[battle on]

I just went through an interesting process with the bank. I have a unit previously valued by the bank at 235k? I wanted to re-finance against it plus some other properties and the bank suggested they re-value it. The value came in at 280k (3 others sold last month in the same complex for 290-315k), and now the bank chooses to completely ignore that valuation even though it was done by THIER valuer!!!!!

I dont understand their logic behind this and it has also restricted me somewhat on the figure I wanted to borrow. Has this happened to anyone or could someone explain why they would do this??

 

[Aaron_C]

When was the last val?

 

[battle on]

Probably 2 years back Aaron for the 235k and the latest was done 2 weeks ago

 

[Aaron_C]

Ok that's odd. Which lender and what LVR?

 

[Corey Batt]

Perhaps the lender is playing funny buggers to hide the real reason behind the refusal? As Aaron said, lender and LVR would help greatly.

This is also just a general unit, not serviced or anything odd like that?

 

[battle on]

It was ANZ.

It is a serviced apartment (so 70% max LVR) however I can withdraw that should I choose and rent it myself. It is returning good figures so I have decided to leave it managed.

Initial purchase price 245K
Initial loan 265K
I have 114k secured against my PPOR which has ample equity available.
Remainder of current loan is 149k

Bank is telling me that along with 2 other properties this loan will be at 80% based on the original valuation of 235K. They still will not adjust their valuation to 280K. They said income is more than adequate so no issues there.

 

[Aaron_C]

Maybe they valued your PPOR and not enough equity there? If you are cross collateralised (which it sounds like) then your bank must've done two valuations and determined that overall there isn't enough there.

 

[Corey Batt]

Maybe they valued your PPOR and not enough equity there? If you are cross collateralised (which it sounds like) then your bank must've done two valuations and determined that overall there isn't enough there.

I think this may be the case.

the numbers are pretty low though, I would suggest trying to get vals from a broker, try untie the cross col and move forward from there.

You really shouldn't be having too many problems unless there is something happening behind the scenes.

 

[battle on]

This is the only cross collateralised property involved. There is over 400k equity in the PPOR so that is definitely not the issue.

 

[battle on]

And even if they didn't wish to lend the amount I require a valuation has been brought to them of 280K, by their OWN valuer. Surely they must recognise it and update their valuation on their books then give me a real reason why they won't lend. Initially they wanted 5 of my properties as collateral on a 100k loan which I would not allow.

 

[Corey Batt]

Do you have access to the valuation? (doubtful but worth asking)

Have they told you why they won't use the current valuation?

 

[INVSTOR]

I spoke To my bank yesterday re. Cross-collaterised properties that I want seperated. She told me the valuation will come in a bit less than what it's worth. I need the value to be a true valuation To avoid LMI. Hopefully next year prices will continue to rise as a buffer for conservative bank Val's.

 

[battle on]

I emailed the bank a few hours ago to ask why they bothered to do a valuation if they never intended to use it. Seems like they wasted their money and valuers time getting it done. No answer back as yet. I'm thinking the question was not one they wanted to hear.

 

[battle on]

I don't have access to the valuation however the figure of 280K is what the bank emailed me back.

 

[Aaron_C]

There must be something else going on there that we don't know about...maybe too much exposure?

 

[battle on]

Nothing else going on, all other properties have substantial equity but by choice I don't wish to use them. Bank valuations on the 3 properties concerned are 710k
Amount owed is 439k without including the security on the PPOR. I figure this at around 62% LVR


And even if its too much exposure all they have to do is say that and I would accept their decision… NOT just totally disregard the valuation.

I just can't figure it.

 

[battle on]

I spoke To my bank yesterday re. Cross-collaterised properties that I want seperated. She told me the valuation will come in a bit less than what it's worth. I need the value to be a true valuation To avoid LMI. Hopefully next year prices will continue to rise as a buffer for conservative bank Val's.

Lets hope so INVSTOR, its certainly overdue for an increase