What does Valuation (homebuying) mean?

Valuation is the process by which the property you are going to buy gets a “price”. This is usually done by a professional, the surveyor who in collaboration with the real estate agencies in the area and helped by other factors will set the most appropriate valuation of the property. You have to know that you are the one paying for this process when you are about to contract a mortgage, and most of the times the lender requires it. It basically serves as a guiding point to the lender with regard to how much money he should lend you. Certainly the lender will also take into consideration outside factors such as your income/s.

Now, regarding how much you can borrow, it is really up to the lender you choose, the type of mortgage, your financial status and other such factors. Most of the times you won’t be able to borrow anything exceeding 75% of the property’s real market value, with the rest 25% having to be paid as an upfront deposit. Terms and conditions vary drastically from one lender to the other, from one area to the other, and if you are lucky you might find cases where the lender is prepared to lend you the LTV in full.

The greater the cost of the property, the higher the valuation fee, this is the usual. However, do not expect no valuation fee under £100.