HOME LOANS: What if the bank finds a lower value in the property?

You can have peace of mind that the bank will not approve a loan, where they have not found value. It is however true that in some cases you will find three banks finding value without a problem and another finding lower value. The banks don’t use each other’s valuation reports and will rely only on their own valuators report.

Should you wish to arbitrate/motivate the banks decision, we will have to provide at least 4 registered sales within the past 6 months, which shows similar purchase prices or higher in the same area, as the property in question. We will then motivate for a second opinion to be given. Some of the banks may insist on an amended OTP, where the purchase price was lowered, while other banks will simply make a lower offer. If you as the buyer are prepared to pay the difference needed, that will be fine.

Excerpt with thanks from Payneless Bonds, bond originators

Feel free to contact Donna for any property-related questions, I’ll be happy to assist.