Who conducts a Mortgage Valuation?
The mortgage lender.
Why do lenders insist on vacant possession?
Some properties are sold with a sitting tenant where there’s no official agreement such as an AST. Tenants have legal rights to stay by law.
What are the two leasehold rules?
- Must have owned the property for 2 years before extending the lease
- Must have 80 years left on the lease before you market a property for sale
What followed from the Grenfell tower disaster?
Rules on cladding and requiring an EWS1 form with a fire safety certificate.
Why are retirement properties hard to sell?
Due to high annual fees.
Why would multiple use property be lower in value?
They could be on top of shops or restaurants which could smell or produce noise.
What protects Flooding and subsidence in a property?
- Floor reinsurance protects these properties
- It’s a capped insurance premium which is added onto the homeowners cost
What is gross yield?
Rent as a percentage of the purchase price.
What is net yield?
Rent minus running costs as a percentage of the purchase price.
What is a basic valuation?
- Lenders do an assesment on the security
- Carried out on behalf of the lender
- Can be a desktop or drive by
- Contract is between lender & valuer
What does a conditional accept mean in terms of valuers response?
Subject to an undertaking or retention.
What is meant by undertaking?
Where the borrower undertakes to make certain repairs within a specified timescale. (3-6 months)
What is meant by retention?
More serious, where the lender retains some or all of the mortgage until the problem is rectified.
What is a RICS home survey Level 1?
- Check basic condition of the property
- Checks overall condition
- Limited survey
What is the RICS survey rating system?
Condition 3 = Serious condition
Condition 2 = Non urgent issues
Condition 1 = No issues at all
What is a RICS home survey level 2?
- Home buyers report
- Includes survey and val report
- Looks at gas, electricity and sewers
- Should discover any serious defects
What is a RICS home survey level 3?
- A building survey and a complete inspection of the property
- Carried out by a qualified surveyor
- Uncovers all major defects
When does subsidence occur?
When the land beneath a property drops unevenly causing the building to shift.
When does Heave occur?
When the land beneath a property rises unevenly causing the building to shift.
What is Reinstatement value?
- Represents the cost of rebuilding a property.
- Normally less than the market value but can be more for non-standard properties.
What are newer properties are part of?
NHBC
- 2 years protection against all defects
- Further 8 years insurance protection against damage over the min claim value
What is meant by long-standing?
Non - progressive.
