Bank valuation

[PaddyPrivillagePalms]

Hi Nigel,
a group of us agreed to buy houses in Frenaros off-plan from the UK in 2007/08, these are now due to be ready for handover in the next month or so. We were told in the sales literature that a 'leading bank' had valued the development & would be willing to lend us up to 80% of the purchase price.

The Bank that was presented to us, one of the largest banks in Cyprus, are now not willing to admit whether they did carry out a valuation on the properties & have pointed out that there was no compulsion under their regulations to undertake a valuation, as the properties cost less than 256k euros each. We find it somewhat surprising that the bank lent 80% of 189k euros to 47 properties without a valuation.

Does this sound plausible from your experience?

Many thanks
Paddy

[Nigel Howarth]

Hi Paddy and welcome to the forum,

I find this very strange. I would have thought that any bank that was approached for a mortgage would carry out its own valuation of the property.

Perhaps in 2007/8 when prices were rising steeply, the bank assumed that the value of the property would increase substantially and therefore did not carry out its own assessment.

It could also be that the bank 'knew' the developer and was willing to loan the money without question.

Regards,

[PaddyPrivillagePalms]

Thanks Nigel,
this is concerning as the purchasers of course relied on having been told that the bank had done a valuation. Is there any way that we can force the issue as regards whether a valuation took place & also actually get sight of it? I have noted that there is no independent financial ombudsman in Cyprus as of yet.

Paddy

[Pantheman]

Paddy, whats your beef? I don't understand what your problem is.

Whether they did a valuation or not, as long as they approved the loans, you got what you wanted.

Are you now looking for a way out and hence asking about the valuations.

Valuations are only good for the time they are taken out to perform an action, after that anything goes. We are in a crisis, any valuation (if done) then, has no real bearing on todays value.

Sorry if I have misunderstood you, but I am not seeing your gripe!

please explain.

P.S. The bank is not obliged to give you a copy of any valuation it has done for itself, thats their business.

Had you requested your own independent valuation, you would have had all the ammo you needed.

[PaddyPrivillagePalms]

Point taken, property market gone down was not the issue at all.

The fact that there is no REAL comeback in Cyprus against banks, lawyers, sales agents or developers, however many false promises or misrepresentations have been made, takes a bit of getting used to for a UK based professional. Different culture, different regulation, c'est la vie.

[pippin]

The banks don't actually do the valuations themselves. They use registered agents to do the valuations. Unfortunately all too often the agents can't be bothered to get out of their offices and just sit and look at what similar properties are selling for and use that to do the valuation.
They then send the bank a nice little invoice for doing the job

[Pantheman]

The banks don't actually do the valuations themselves. They use registered agents to do the valuations. Unfortunately all too often the agents can't be bothered to get out of their offices and just sit and look at what similar properties are selling for and use that to do the valuation.
They then send the bank a nice little invoice for doing the job

Totally agree.

I had a valuation done via the bank, some 'kid' came around walked in the front out of the back, measure length x breath.

And the valuer gave us a valuation.

Needless to say, I had alot to say to this little pr**k, enough said, don't get me started.

I could do a far better job thans these idiots.

All they have is a name and some initials to add to the valuation and somehow magically it means something.

Pft!