Current COVID-19 social movement restrictions have made it almost impossible for lenders to complete physical property valuations, resulting in application process delays. Director of Sales, Jeni Browne, explains what lenders are doing and why this doesn’t mean you shouldn’t submit your mortgage applications.
Since the introduction of the Government lockdown which restricts social movements to just essential journeys, a number of valuation firms and lenders have stopped conducting physical valuations. Not all valuers have stopped visiting houses, but they are also facing restrictions from property occupants who may be in isolation or do not want people entering their home. This situation has led to a significant drop in the number of houses being valued.
However, it is not all doom and gloom. While many buy to let lenders are currently unable to perform valuations because their criteria requires them to complete a physical valuation, some lenders are still offering remote or ‘desktop’ property valuations under particular circumstances.
Which properties can have remote valuations?
The criteria for remote (or desktop) valuations vary, depending on the type of buy to let property you are trying to mortgage/remortgage and what level of Loan to Value (LTV) you require. For example, for one lender, houses of standard construction, with a loan of up to 60% LTV and no more than £500,000 in value, can be valued remotely. For houses worth up to £750,000, the LTV must be below 50%.
Buy to let property purchases are more than likely to require a physical valuation, but for those looking to remortgage, desktop valuations are more common. As remortgage properties generally have lower LTVs and are likely to have received a valuation more recently, lenders may be happier to value them remotely.
Does the type of property affect whether I can get a remote valuation? In short, yes... the majority of lenders that are processing desktop valuations are favouring ‘vanilla’ properties; houses and flats that are already habitable (not requiring refurbishment). More complex properties such as HMOs, highrise flats, new builds and those built using non-standard construction methods are likely to need a physical valuation and will have to wait until valuers can get out and about again.
What is happening to mortgage applications?
Many lenders are continuing to underwrite mortgages, leaving only the valuation to the end to be processed when it becomes possible. Of course the delay this is causing will have a knock-on effect even after isolation rules are changed as there will be a backlog to clear. Lenders have told us that applications are being stacked and will be dealt with on a ‘first in, first out’ type policy, meaning that the quicker your get your application in now, the sooner it’ll be processed when everything starts moving again.
If you are looking for a valuation to be carried out before the restrictions are lifted and would like to see if your property could be eligible for a desktop valuation, or if you have an active application you want to discuss, do not hesitate to contact our brokers on 0345 345 6788 or email firstname.lastname@example.org.