Downvaluation

Definition

A downvaluation is when the lender’s valuation of a property is lower than the agreed purchase price.

Why it matters

If the lender bases the mortgage on the lower valuation, you may need to:

• bring a larger deposit to complete at the agreed price, or
• renegotiate the price (or change plans)

It can also change your LTV because the “value” used for the LTV calculation may be the lender’s valuation rather than your offer price.