People Tending To Overvalue Their Houses In Remortgages by up to 20%
Remortgage.com have reported that people applying for remortgages are tending to over value their properties by up to 20%, resulting in disappointment when they find the true value.
40% of customers who applied via remortgage.com this year have over valued their properties according to the site. These over valuations range from 5-20% in the more severe cases. "People are still considering their houses to be worth what they were a few years ago, when in reality, property prices are mostly lower than they used to be in the boom" said Robert Prime of remortgage.com.
We recommend that people use up to date property valuation tools online or are more realistic in their valuations, as a general rule of thumb, it may be prudent to value your house and then reduce 10% so as not to be disappointed when applying. The lower valuations result in a higher loan to value and thus increased interest rates and higher refusal rates.