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‘Valuers have become uncomfortable gods’ – Star Letter 15/07/2022

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  • 15/07/2022
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‘Valuers have become uncomfortable gods’ – Star Letter 15/07/2022
Each week Mortgage Solutions and its sister title, Specialist Lending Solutions, pick the top comments from our readers.

The first was from Derek Compton, who responded to the article: Surveyors should stick to today’s reality not future caution – JLM 

He said: “Let’s face it, valuers have become uncomfortable gods, allowed to make almost life or death decisions on their opinion. We know they are supposed to consider local comparable, but I, and I am sure many of you, have examples of comparable ignored as they didn’t suit a valuation. During Covid, there was down valuation after down valuation from some companies.” 

He added: “My last down valuation shows that they change to suit themselves. After being told that a property with an expected £380,000 value needed a physical valuation due to extensions, the valuer chose to ignore this and valued the property on desktop at £300,000 supposedly using local comparable values. The property had been valued at £320,000 two years ago. 

“When told to go out and do a physical valuation, they did another desktop. This time, with exactly the same information on the property and comparable only a week older they valued at £380,000. This came up in the client’s favour but it goes to show that they are making it up as they go along as they cannot be challenged.” 

  

Inappropriate advice?

The next article to receive a comment was: Brokers fear coming financial storm may result in equity release ‘misuse’ ‒ analysis 

Andy Wilson said: “There will only be one group responsible for any inappropriate sales of equity release to borrowers, as described, and that is the adviser community. 

“It won’t be the lenders, nor the solicitors, it will be the adviser community, and more specifically those amongst us who don’t have the skills and knowledge to dig deep into the client’s situation, properly explore the alternatives and recognise when another course of action is more appropriate. They will also need to resist insistent clients who want to release more than is necessary from a new plan, and save them from themselves in some cases.” 

He continued: “The financial pressures may be relatively short-lived, but as they say, a lifetime mortgage is for life, not just for a crisis. (They don’t they say that? My bad.).” 

  

Uneven restrictions 

A responder calling themselves ‘very deceptive’ remarked on this article: Stress test removal should be delayed as we figure out cost-of-living impact – Hunt 

They wrote: “An affordability measure that allows for an increase in rates appears to be rational. Rates are increasing at least in the short-term so this is surely logical. Although, perhaps a calculator including a rate rise of three per cent may have been heavy-handed, with history proving this during the last 14 years. 

“What appears uneven is the use of income multiples restricting lending. For instance, virtually everyone renting in the lower half of England has spiralling costs, more often than not, exceeding the equivalent mortgage cost for the same property. As per usual, regulation has things backwards.” 

They continued: “By the way, buy-to-let lending completely ignores any of these restrictions, basing virtually all criteria on the size of the rental income. First-time buyers continue to struggle while landlords can buy an extra property with ease.” 

  

On-the-job stress 

Another article to receive a comment was: Nationwide to launch cost of living hotline to help struggling customers 

Spinmeister weighed in, saying: “Perhaps a helpline for distressed brokers would also be appropriate?” 

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