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Do You Need Property Valuer Before Applying for a Mortgage?

No matter the property you are trying to get, having accurate information can help you achieve better results. When different parties involved in a process have precise information, it’s easier to make individual decisions. Thus, minimizing risks and potential problems. Indeed, this applies to the property market too. If you are looking to get a home through a mortgage, then an accurate property valuation will come in handy. The process involves having a property valuer who will do all the ground check to ensure that the property meets the standards. In this guide, we look at the importance of hiring a property valuer before you apply for a mortgage.

What is Property Valuation?

Property valuation helps individuals or organizations to know the real worth of a property. It’s the knowledge and skill of estimating the fair price at which an asset or a property would exchange for in the market.

Why Carry out Property Valuation?

Unlike other investments, the merits of real property are realized in the long run. Hence, an estimate of the properties values assists the owner to take into considerations the social and economic trends. As well as government and environmental factors that influence the value of the property. Thus, house valuation in Melbourne is critical in decision making both for the buyer and the property owner.

Besides, it’s vital that property valuation become part of your usual decision making. Especially if you are considering real estate transactions. If carried out according to the set standards, it yields an unbiased and credible assessment of the value of the property. Additionally, it plays the following critical roles to both the property owner and the buyer.

1. Helps in determining the difference between value and price

A qualified and competent valuer will assess a property and help you understand the worth of the property. The decision can be based on the terms prevailing in the current market. Other hosts of reasons including; insurance purposes, mortgage/loans, financial planning, property tax among others. Property sum insured is based on the perceived buying price or market value. Based on this, the property’s cost might be mistaken since the open market value can’t be used to determine the valuation of a property and this where property valuers come in handy.

2. Property Valuation helps guide buying, selling, and investment decisions.

Property investment is one of the vital decisions you will make. Therefore, it should be made objectively. Having an experienced valuer can assist you in making objective decisions in regards to buying a property. Additionally, their valuation and advise can act as a guide to the best mortgage plan that you can have. It’s, therefore, essential not to overlook their input.

3. Property Valuers Provide clarity that helps prevent unrealistic expectations

Having a peculiar attachment, a property can obscure your judgment. Besides, each person forms emotional attachments to their property, and it can affect how much one believes their property is worth. To avoid this, you need the services of a property valuer. If you’re buying a property, a valuer can help provide good idea you can convincingly expect the property to be sold at. Unlike many consumer goods, the value of a real estate is realized in the long run; thus making valuation indispensable.

4. Property valuation document is legally binding

The property valuation document is a valuable document. In includes property rates, information, size, and physical detail. These details are vital especially when one is seeking out for mortgages. Having these details can keep you on track when making the purchase decision. At times, when dispute arises, the documents can be used as a point of reference since they are legally binding.

5. Valuation is essential to Mortgages

Did you know that mortgages also require property valuation? Well, if you’re planning to acquire a mortgage for a property, you better be prepared to engage a certified property valuer. Property evaluation is considered by lenders to protect their risks. Lenders always give home or property loans not more significant than the value of the property or lending against the non-marketable ones. Besides, the valuation also informs the lender if there’re features or significant defects that could the property’s value. Since the property is a security against a loan, the valuation process is pivotal exercise before any mortgage is approved.

6. Valuation helps in preventing financial shocks

If you’re buying a property off the plan, in circumstances where the prices may be affected by rebates, developer profits or incentives, a lower valuation might require you as a buyer to dig deeper into the pocket. Such a plan if not carefully taken care of can result in financial shocks. Thus, it is critical to engage a competent valuer who can advise to avoid any future costs.

Final Thoughts

The process of property valuation can be considered as both art and science. It’s a beneficial process that takes off a lot of trouble from property buyers. For sellers, the correct property valuation is essential for a successful sale while for buyers, it helps them in making critical decisions specifically if the property is to be acquired through mortgage or loan. Therefore, to this end, the exercise of property valuation is both vital for the seller and buyer of the property, and it’s something that can’t be easily wished away.

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