Mortgage Declined After Valuation: Here is What to Do Next

During the mortgage application process, lenders appoint a surveyor to carry out an independent valuation of the property to make sure it’s worth the amount you’re paying and check whether there are structural or build issues they need to know about.

If they don’t like what they read in the report, there’s a chance they could decline your application. If this has already happened to you, it’s understandable if you’re stressed and disappointed, but don’t throw in the towel just yet. We’ve put together this handy guide to tell you exactly what to do to salvage a mortgage application that broke down at valuation.

What to do if your mortgage was declined after the valuation survey

Firstly, be assured that mortgage approval is still possible. While being declined at valuation can feel like a heavy blow, there are steps you can take to get your plans back on track.

Here’s what you should do if you’ve been declined for a mortgage after valuation…

1. Don’t re-apply straight away

This might be tempting, but there’s no guarantee things will turn out any differently if you head back to the drawing board without professional advice.

Whatever issue was flagged up by the surveys – whether that’s a down valuation, a structural issue or a build type the lender doesn’t like – could come back to bite you again.

2. Let us match you with a mortgage expert

Our free broker-matching service can pair you with a mortgage advisor who specialises in helping customers who were declined at valuation. They will advise you on whether there’s a quick fix – such as putting down extra deposit or renegotiating with the seller – but if this isn’t the case, they could help you revive your plans with a specialist lender.

3. Take a breather while your broker does the legwork

Your mortgage broker will carry out a quick fact find to establish why you were declined at valuation. If it was a down valuation, they will explore whether there are grounds for appeal or a second opinion, as well as present you with a list of possible solutions to this.

If there was an issue with the property itself, they will search the entire market for a lender whose criteria allows them to overlook certain structural issues and build types.

Make an enquiry with us today and we’ll match you with an expert who could help you get your mortgage application back on track as quickly as possible.

Why a mortgage might be declined at valuation

Here are the most common reasons mortgage applications are declined at valuation…

The property isn’t worth what you’ve agreed to pay for it

This is also known as a down valuation and if one comes up in the survey, the lender would usually alter the amount they’re willing to let you borrow or pull the plug entirely.

If your property comes in under value, solutions your broker will explore with you include…

• Increasing your deposit (if you’re in a position to)
• Renegotiating with the seller
• Appealing against the valuation survey
• Finding another mortgage lender

Issues with the property

During the surveys, structure issues and other problems with the property you’re buying might come to light, and this can result in the lender declining your application.

Common issues that can trigger an automatic mortgage rejection include…

• Cladding
• Damp
• Asbestos
• Japanese knotweed
• Structural problems

These are merely a handful of the property issues that some lenders consider deal-breakers, but the right mortgage broker can help you overcome them. Common solutions include having repair work carried out or finding a lender who can overlook such issues.

Non-standard construction

Some lenders class properties that aren’t made from bricks and mortar as ‘non-standard construction’ and these homes are often more difficult to get a mortgage on since not all mortgage providers have flexible enough criteria to lend on these build types.

Types of non-standard construction that could trigger a rejection at valuation include…

• Thatched roofs
• Steel frame
• Timbre frame
• Single brick
• High rise flats

If non-standard construction was the reason your mortgage was declined, the good news is that there are brokers in our network who specialise in arranging mortgages for these properties. They have deep working relationships with lenders who offer non-standard construction mortgages and could help you revive your application with one of them.

Can a mortgage be declined after the valuation fee has been paid?

Yes, and you can be at risk of losing the fee you paid if your mortgage application breaks down at this stage. The best way to safeguard yourself against this is to speak to a mortgage broker, as they can significantly improve your chances of being approved first time.

If you have already been declined and were charged a valuation fee, a broker can still help you out. They will explore whether there are grounds to appeal against the valuation survey result and the potential to negotiate a fee refund with the surveyor/lender.

Even if there is no way to reclaim any upfront fees you were charged, you might end up in pocket overall if your broker finds you another lender offering a superior deal.

What to do if you’ve been declined at valuation by a specific lender

The brokers we work with can help you regardless of which lender has rejected you at the valuation stage, but you might want to read through the relevant guide below if you’ve been turned down by a specific lender and want to know what your options are…