Do you know how upfront valuations work?
If you’ve never dealt with a mortgage broker, it’s most likely you’ve never heard of what an upfront valuation is.
Upfront valuation is generally used to find the value of a property before an application is submitted, the benefits of using a mortgage brokers is the access to a range of lenders that allow the use of this service free of charge, this is so the planning of an application has a smoother process.
While as a consumer if you submit an application through the bank directly, majority of the banks will only do a valuation once the application is submitted. local Mortgage Broker
So, what do they do if the valuation comes back low? Does that mean you cannot refinance? you don’t can’t get the equity you need? You cannot purchase the property you want?
A mortgage broker has the ability to order multiple valuations with different lenders.
How can upfront valuation benefit you?
- To obtain the highest valuation on a property to draw out as much equity as possible.
- Off the plan and land purchase, this could be:
- looking for the highest valuation possible as there’s been massive growth since the time of signing the contract (over 12 months), you want to borrow based on the increased value not the original purchase price, OR
- looking for the highest valuation possible due to a market down turn and the value has decreased since the time of signing the contract. You want to obtain the highest valuation possible to cushion the shortfall. First home owners grant
- Purchase of a property (Private Treaty or Auction) before signing of a contract, if agent allows and conditions apply.
- This is so you have the full confidence of making an offer, your highest offer, and not be scared if valuation will come back short of purchase price.
- investment Property