UK VPGA 11 Valuation For Residential Mortgage Purposes

Question 1

What is the purpose of a valuation inspection for mortgage purposes?

Answer 1

To ensure the provision of a valuation upon which the lender can base the terms of a loan, and to identify and report those matters that may have a material effect on the value.

Question 2

When should a external or desk top inspection be complied with?

Answer 2

Firstly ensure it is absolutely clear on the terms of Engagement.

The valuer should excersise caution as to the intended use of the valuation.

Question 3

What Valuation Practice Guidance Application refers to residential mortgages?

Answer 3

VPGA 11 - Valuation for residential mortgage purposes

Question 4

What involvement have I had?

Answer 4

I have given, under supervision, advice in connection with UK residential secured lending to mortgage lenders.

Including:

• individual residential property that is to be occupied or is occupied
• an individual property purchased as a buy-to-let Investment.

Question 5

What do most lenders have?

Answer 5

Standard terms of Engagement and formats of reports

Question 6

What body are the lenders regulated by?

Answer 6

The FCA Financial Conduct Authority

Question 7

How is the FCA’s criteria met?

Answer 7

By following the PS 1 & 2 (professional standards)

Question 8

In order to be considered for a regulated mortgage what must the asset consist of?

Answer 8

At least 40% of the land must be a property or in connection with a property or is to be developed or adapted to such use with no other significant use

Question 9

What is the role of the valuer on mortgage vale?

Answer 9

A - To advise on the nature of the property and factors that are likely to affect value
B - To advise on the market value
C - to advise on serious cases of disrepair that will have an affect on the value

Question 10

What is the remit of the valuer for mortgage purposes?

Answer 10

To provide an objective valuation opinion having regard to the lenders policy and requirements.

Question 11

What basis of value is used for a loan security valuation?

Answer 11

Market value of market Rent

Question 12

I have recently carried out a valuation on a new build on a development site, what special assumption was accepted?

Answer 12

That the works would be complete to a satisfactory standard.