When you take out a new mortgage on a property (whether house purchasing or a remortgage), the mortgage lender concerned needs to value it in order to ensure that it offers sufficient security. There are three levels of valuation/survey:
1) Basic valuation
is carried out purely on behalf of the mortgage lender even though you may have to pay for it. Most lenders charge valuation fees on a scale depending on the value of properties. The report is basic, and all lenders disclaim any responsibility for the condition of the property. You have no comeback against the surveyor for any defects or problems overlooked in the report.
2) Homebuyers’ report
a more detailed but still limited report to a set format on the readily accessible parts of the property. It may offer you some limited recourse should the surveyor, who is acting on your behalf rather than the lender’s, be negligent.
3) Full structural survey
the most thorough (and most expensive) report. If the property is defective, the surveyor should discover this. If major defects are not discovered then the surveyor acting for you would have some legal liability, and you would be able to claim redress.
With any level of survey, if there are potential or actual defects found the surveyor may suggest you obtain additional specialist reports, which could be at your expense and may be time-consuming. If you opt for a homebuyers’ report or full structural survey, you will sign a contract with the surveyor to formalise his responsibilities to you.
Applicants should always check with mortgage lenders before instructing their own valuation or survey. Lenders tend to work with panels of surveyors, and if your surveyor is not known to your lender you may find yourself paying again for a valuation by one who is known.
