Mortgage Advice - rip off?!

[funkylad20]

We bought a house as a trio 3.5 years ago, for £225k. Obviously house values have dropped, but fortunately not as much for us as some areas. I bought one housemate out last year and recently my other half moved in and bought my other housemate out, with a house value of £209k. We decided on the £209k as the average from five local valuations.

We have a mortgage of around £183k with A&L (now part of Santander but still A&L). We applied for a 'transfer of equity' from them (as we did the previousyear when I bought the first housemate out) and they came back with a statement to say we need to pay them c.£6k as the house price is now £181k as per some search they used (info something or other?). Persoanlly this is a ridiculous value (I am not just saying that!) for where the house is etc. and going on other sales of similar houses locally.

Can anybody explain to me why A&L have done a search to value the house? Surely they are just assessing the risk of the proposed new mortgage customer (my other half, who earns twice what my old housemate earnt and has no debts or bad ratings etc.).

They said they are happy to arrange us having another accurate valuation, which obviously I shall have to pay for...It seems like a bit of a con to me, am I right? I sort of understand loan to value etc. but to go off and value the house innacurately using some random database seems odd...

[Nosha123]

I would imagine its a simple desk top study they have done.... to get the lower valuation they have.

Can you provide them with a bundle of evidence to object to it? (do you even have time to do that!!).
Inc houses sold that are the same as yours.. plus the valuations of all 5 agents.
I doubt that they will accept this as proof - but they might!
Otherwise you'll have to request a more detailed valuation (which.. be warned could be LOWER than the first!)

2 years ago Abbey valued our house at about £500k based on desktop study - despite all the improvements we had done to it and valuations we had done. It was worth MUCH more.
I didnt take the matter any further as another issue came up so didnt re-mortgage anyway...

[redcrx]

where did you get your valuations from and have you looked at the prices similar properties have been SELLING for rather than FOR SALE at.

just because an estate agent may say they would market a house at £209k it does not mean that it would sell at that, and many agents seem to be asking vendors to drop their asking prices pretty much straight after marketting starts. I would have thought that Santander would know what they were talking about.

[funkylad20]

Thanks for these replies...

The values of the opther houses in the area is the COMPLETED SALE price, not For Sale. I understand how Estate Agents all try and hype up the prices to make you go with them etc., have seen through all of that, but genuinely the value has not dropped £40k in the time I have owned it! I understand that this is possible in some areas, but this is not the case here.

I still do not understand why they have decided to re-value the property though, that is what has thrown and annoyed me?! If my housmeate had not wanted to move, they would be none the wiser, so I don't understand. They did not do this last year and it is not like we are trying to release any equity etc.

[Nosha123]

They have all changed their policies and are all being super cautious... They are doing multiple checks on all applications as worried they may get their fingers burned.
Sadly doesnt help those who genuinely can afford to borrow though!