Type of service
Limited assessment for the lender (bank or building society). Alternatively this type of report can be provided for a variety of other uses, namely; probate, taxation, matrimonial, expert witness reports, insolvency and asset valuations and compulsory purchase cases.
Reason for service
Often a brief report primarily concerned in providing advice on value, taking into account the property’s condition and prevailing market conditions, recommended where you are uncertain about value, or you think you may be paying too much for a property. For lending institutions, to assess the property’s value as security for the proposed loan – not intended to identify defects unless they severely affect value. To advise the lender, not the purchaser.
Mortgage lenders may charge the prospective borrower an application fee significantly higher than the valuation cost, or may include such charges in the overall cost of the loan, in certain circumstances the property may not always be visited. RICS research shows a quarter of all homebuyers who only had a mortgage valuation report had to undertake unplanned repairs or building works to their property after purchase. A Market Valuation report is not a Survey of the property and you should not rely on this type of report as a comprehensive statement of the property’s condition.
In accordance with RICS “Red Book” guidelines, lenders usually present the data on their own standard forms, and sometimes provide a courtesy copy to the borrower.