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I have the ability to view my mortgage details online. Last year I was alerted I could take advantage of a new fixed-term when my other ended. The forms came and I signed and set them back. Agreeing with the LTV of the original valuation of the house 4 years prior. I naively thought this was the way it was done. Within months of the new agreement, my lender's online dashboard now shows a current valuation which is way above the valuation they gave me on my fixed. In fact 12 months on now its £90k over their valuation and almost halving the LTV!

Can i do anything about disputing their valuation or is it hard luck once you've signed and agreed?
 
Why not ask your local Citizen's Advice Bureau? If you find them helpful you could always make a donation (they are a charity).
 
What effect has the revised LTV had? Has it affected how much you pay etc? I'm failing to see any reason for you worrying about this?
 
Higher LTV can effect the interest rate so the new fixed deal he signed up to could potentially have been much better had he been aware beforehand of the increased value and subsequently got it reduced.
 
Higher LTV can effect the interest rate so the new fixed deal he signed up to could potentially have been much better had he been aware beforehand of the increased value and subsequently got it reduced.


Agreed. However if the bank have increased the valuation of the property (as per the op) then it will have lowered the LTV. As the op has stated.

I’m struggling to see a negative
 
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Agreed. However if the bank have increased the valuation of the property (as per the op) then it will have lowered the LTV. As the op has stated.

I’m struggling to see a negative
He'll be paying a higher rate than he'd have paid if the LTV was lower.
 
I think he's just worded it badly and means it's the 'value' or 'worth' of the ratio which has halved and not the actual ratio itself.
 
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Agreed. However if the bank have increased the valuation of the property (as per the op) then it will have lowered the LTV. As the op has stated.

I’m struggling to see a negative

If the value of the property has increased then the LTV increases (although technically not really in this case). Personally I find it a bit snide that they do this calculation when renegotiating rates and fixed terms (and outwith the original purchase of the house or if remortgaging) because the value of money originally borrowed hasn't changed. It should really be irrelevant and actually the property value increasing subsequent to the original money being borrowed should really be favourable because there's more equity and therfore less exposure.

But it's predictably win, win for the mortgage providers.
 
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If the value of the property has increased then the LTV increases (although technically not really in this case). Personally I find it a bit snide that they do this calculation when renegotiating rates and fixed terms (and outwith the original purchase of the house or if remortgaging) because the value of money originally borrowed hasn't changed. It should really be irrelevant and actually the property value increasing subsequent to the original money being borrowed should really be favourable because there's more equity and therfore less exposure.

But it's predictably win, win for the mortgage providers.
It is favourable.
As the value of the house increases, the LTV decreases, and should therefore attract a better rate.
If you borrow £90k on a £100k house you have an LTV of 90%.
If you take out a new deal and the house is worth £160k, and your new deal is for £80k, then the LTV is 50% and less risky for the lender, so the rate is lower.
Mortgage lenders use a standard calculation when working out the property value.
If you dont agree you can ask for a valuation to be carried out, but that might not always go in your favour.
 
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I understand that if the LTV is lower there is the "potential" to have a lower interest rate but the op hasn't stated that actually happened. Has it resulted in the op getting fleeced for a higher rate, if so I would presume he could take it up with the financial ombudsman.
 
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It is favourable.
As the value of the house increases, the LTV decreases, and should therefore attract a better rate.
If you borrow £90k on a £100k house you have an LTV of 90%.
If you take out a new deal and the house is worth £160k, and your new deal is for £80k, then the LTV is 50% and less risky for the lender, so the rate is lower.
Mortgage lenders use a standard calculation when working out the property value.
If you dont agree you can ask for a valuation to be carried out, but that might not always go in your favour.


That's how I see it should work but TSB (perhaps it's just them) simply take the new value and use your original deposit as the calculation. They wouldn't accept my argument that technically the ratio had actually decreased and to compound on this the amount loaned was technically less as well because a big chunk of the mortgage had also been paid off.

But again perhaps that's just TSB so that they can try to squeeze a higher rate out of you.
 
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But he stated in the op the increase in valuation has about halved the LTV. So what’s the negative?
That in itself isn't a negative, but the valuation they used when offering his new deal was lower, so the LTV was higher at that point, and therefore the rate offered would be higher.
 
That's how I see it should work but TSB (perhaps it's just them) simply take the new value and use your original deposit as the calculation. They wouldn't accept my argument that technically the ratio had actually decreased and to compound on this the amount loaned was technically less as well because a big chunk of the mortgage had also been paid off.

But again perhaps that's just TSB so that they can try to squeeze a higher rate out of you.
What they may do is use your original mortgage amount against the new valuation, but not the original deposit amount.
 
It does sound like they've pulled a bit of a sneaky one on him, unless there's some official timeframe of when house valuations are assessed?
 
It does sound like they've pulled a bit of a sneaky one on him, unless there's some official timeframe of when house valuations are assessed?
It's all linked to the house price index, so it's possible that it has increased in value considerably in 4 years.
 
What they may do is use your original mortgage amount against the new valuation, but not the original deposit amount.

But that would still reduce the LTV? By using the deposit instead they artificially increased it. I did feel like she was simply tapping away on a calculator on the phone to me, in retrospect I should have been more on the ball but the rate was so good as the LTV was still very low and my credit rating is excellent there probably wouldn't be much lower a rate to go so what's the point?

Anyway, enough about me and back to the OP!
 
It's all linked to the house price index, so it's possible that it has increased in value considerably in 4 years.

I'm just wondering if this has just been a case of bad timing. If so then when it comes to the next deal it could be worth him going variable for a few months to allow any valuations to update?
 
But that would still reduce the LTV? By using the deposit instead they artificially increased it. I did feel like she was simply tapping away on a calculator on the phone to me, in retrospect I should have been more on the ball but the rate was so good as the LTV was still very low and my credit rating is excellent there probably wouldn't be much lower a rate to go so what's the point?

Anyway, enough about me and back to the OP!
That's right.
Below 80% ltv rates tend not to vary much.
 
I'm just wondering if this has just been a case of bad timing. If so then when it comes to the next deal it could be worth him going variable for a few months to allow any valuations to update?
No, the valuation should be accurate at the time.
If he doesn't agree with it, they'll send out a surveyor to value it specifically.
 
That’s not how I read it.

I originally read it as he assumed the valuation was the same as when he had bought the house and he'd subsequently discovered they had actually increased it for the new deal, so some of my initial posts may be a little confusing :facepalm:

It's my own fault for occasionally skim reading whilst also trying to do other things, well watching TV.
 
That's right.
Below 80% ltv rates tend not to vary much.

I always thought it was around 60% and lower which is where things don't change much? I think I'm around 25% LTV thanks to rising house prices and an attic conversion so all pretty irrelevant. Was more the principle, but I'm also to blame in fairness for being slack.
 
I always thought it was around 60% and lower which is where things don't change much? I think I'm around 25% LTV thanks to rising house prices and an attic conversion so all pretty irrelevant. Was more the principle, but I'm also to blame in fairness for being slack.
Depends on who you're with.
Like you say, in your case it would be totally irrelevant.
 
Thanks for all the replies. Yes reading over my post it wasn't clear but you've all worked it out in the end! :)

Yes, it was valued at the original price 4 years ago but until they changed their website to now include my valuation, I thought this was how it was done when starting a new fixed-term rather than a completely new mortgage.

My LTV on the fixed term of 5 years using the original house value is 73.8% however when i log into by online dashboard its giving me an LTV calculation of just 45%.


P.S while i took a screenshot i noticed it says the last valuation 2003 which is incorrect it was 2013. Perhaps this would explain the current valuation if they've used some formula to calculate the current valuation from an incurrent valuation in 2003?
 

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Have any similar houses nearby sold where you can check sale prices out?
 
Thanks for all the replies. Yes reading over my post it wasn't clear but you've all worked it out in the end! :)

Yes, it was valued at the original price 4 years ago but until they changed their website to now include my valuation, I thought this was how it was done when starting a new fixed-term rather than a completely new mortgage.

My LTV on the fixed term of 5 years using the original house value is 73.8% however when i log into by online dashboard its giving me an LTV calculation of just 45%.


P.S while i took a screenshot i noticed it says the last valuation 2003 which is incorrect it was 2013. Perhaps this would explain the current valuation if they've used some formula to calculate the current valuation from an incurrent valuation in 2003?

If you haven't had it revalued then they'll just apply some indexation based on the average change in house prices between the date of valuation and the date of remortgaging.

EDIT:

Yep, looked at your screenshot now "HPI Valuation" = House Price Index Valuation
 
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My LTV on the fixed term of 5 years using the original house value is 73.8% however when i log into by online dashboard its giving me an LTV calculation of just 45%.

For LTV lower = better => don't argue with them ;)
 
Thanks for all the replies. Yes reading over my post it wasn't clear but you've all worked it out in the end! :)

Yes, it was valued at the original price 4 years ago but until they changed their website to now include my valuation, I thought this was how it was done when starting a new fixed-term rather than a completely new mortgage.

My LTV on the fixed term of 5 years using the original house value is 73.8% however when i log into by online dashboard its giving me an LTV calculation of just 45%.


P.S while i took a screenshot i noticed it says the last valuation 2003 which is incorrect it was 2013. Perhaps this would explain the current valuation if they've used some formula to calculate the current valuation from an incurrent valuation in 2003?
Did it affect the interest rate you were charged on your new deal adversely?
 
Did you read the first post?

Read, yes. Understood, no :)

Got it now.

IMO very little you can do unless the penalties for exiting the fixed rate are lower than the saving created by the new LTV. But it's not real money - it's just opportunity cost. You were happy with the fixed deal at the time. Stop looking at the dashboard until it ends.
 
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