All Topics / Help Needed! / Registered valuation dilema

Viewing 8 posts - 1 through 8 (of 8 total)
  • Profile photo of SPTSPT
    Member
    @spt
    Join Date: 2004
    Post Count: 10
    April 26, 2004 - 8:22 pm

    Hi all

    My wife and I live in New Zealand and are new to property investing, having bought three properties over the last six months. We are very happy with our purchases and believe we are cautious in our approach, not going into anything too hastely. It took us around six months to find our first property once we decided on our plan.

    I have read and re-read 0-130 and have also been reading the forums for the past three or four months now. I have found them very informative but would like some advice please. The problem we have is with a registered valuation we had carried out on a property which came out under valued. Our last two property purchases was based on this valuation being $245000 or greater. We were disappointed to find it valued at $199000, but as this was our first dealings with a valuer thought they were just being cautious. As there was a short fall of $46000 we had to take out a commercial loan being aound 2.2% higher, because one purchase was 55% commercial. A month or two past and by chance I bumped into another employee of this firm (I wont mention names) and explained our situation. He indicated there seemed to be a problem and as it turned out they re-visited the property which was re-valued at $275000 being $76000 greater!!!!!. Unfortunately we are now stuck with this commercial loan which will cost about $3000 extra in interest over three years.

    The question I have is what re-course is there over them making such a large error? They told us the land value and improvements were not included in their first valuation. I also found out the person that did the valuation was relatively new to the business, but his work was checked and approved by someone more senior. This does not help us. Surely they have some responsiblity on outcomes of valuations as they are being carried out all the time for the banks. It makes you wonder how many inaccurate valuations have been submitted to banks with the customers not getting the results they wanted.

    I am kicking myself with the way I took the loan out, but have learnt from the lesson and hope that with myself sharing this experience with everyone will prevent someone else making a similar mistake.

    This morning I am off to the valuers to state my case!!!!

    Regards

    SPT

    Profile photo of AceyduceyAceyducey
    Participant
    @aceyducey
    Join Date: 2003
    Post Count: 651
    April 27, 2004 - 1:17 pm
    Originally posted by SPT:


    Unfortunately we are now stuck with this commercial loan which will cost about $3000 extra in interest over three years.

    Why are you stuck?

    Revalue and get a new loan….

    See if you can get the valuer to pay all the exit & transfer costs – cause they made a MAJOR stuff up!

    Cheers,

    Aceyducey

    Profile photo of PurpleKissPurpleKiss
    Participant
    @purplekiss
    Join Date: 2003
    Post Count: 580
    April 27, 2004 - 2:02 pm

    I’m with Aceyducey on this one. They ahve liaibility insurance that you can probably make a claim against. However, you may find that they will come to the party if you write to them asking for the costs that Aceyducey mentioned. You could also try asking for a refund of the addiotnal interest you have paid which you wouldn’t have paid if the valuation had been correct.

    Good Luck and let us know how it goes.
    PK

    Profile photo of yarwoodyarwood
    Member
    @yarwood
    Join Date: 2004
    Post Count: 11
    April 27, 2004 - 2:37 pm

    Hi!

    Yes please let us all know how you get on! I could imagine that the valuers might say that the valuation was for the benefit of the lender and no other person – even if you were the person who paid for the valuation. I think many people will want to know how you get on.

    Good luck!!

    Profile photo of shaunwalkershaunwalker
    Member
    @shaunwalker
    Join Date: 2003
    Post Count: 403
    April 28, 2004 - 3:02 am

    i have a funny story for you, i live in a block of 6 units. myself and one other owner/occupier got new quotes about a month ago, valued at 195k, the third owner/occupier found out about this and refinanced her loan as well, her value came in at 185k, all the units are the same, and in fact hers is the nicest out of all of ours.
    am off to the bank (which bank?) to get a copy of the valuation for her.
    no idea why hers came under value from ours.
    cheers
    shaun

    Lead, Follow or get out of the bloody way

    Profile photo of SPTSPT
    Member
    @spt
    Join Date: 2004
    Post Count: 10
    May 23, 2004 - 9:49 am

    Hi all

    Thanks for the advice to those who replied. Just to let you know I have recently banked a cheque from the valuers to cover the refinancing and extra interest incurred over the term of the business loan. Although they didn’t admit liability, they claimed they paid out as an ‘indication of goodwill’.

    So now we are saving on interest costs and have $77000.00 in extra equity – happy ending.

    Cheers

    SPT

    Profile photo of melbearmelbear
    Member
    @melbear
    Join Date: 2003
    Post Count: 2,429
    May 23, 2004 - 11:38 am

    Good stuff[specool]

    Awwww, I love a happy ending[inlove]

    Cheers
    Mel

    Profile photo of CeliviaCelivia
    Participant
    @celivia
    Join Date: 2003
    Post Count: 886
    May 23, 2004 - 11:55 am

    Wow congratulations, SPT, I was following this post with interest!
    Well done![biggrin]

Viewing 8 posts - 1 through 8 (of 8 total)

You must be logged in to reply to this topic. If you don't have an account, you can register here.