Valuations And Survey Flashcards
Which type of survey is most likely suitable for the following?
A) Cheryl’s and Dave, who are buying a semi-detached property dating from the early 20th century in south east London?
B) Katya, who is buying a three-year old house on a new development in Peterborough?
C) Dan and Greg, who are buying a thatched cottage in Dorset that is more than 200 years old?
D) Iqbal, who is buying his first home, a 12 year old starter home, and is on a tight budget?
As an advisor should you recommend a particular survey to any of these buyers?
A) it would be prudent for them to invest in a building survey or home buyer report. Property is old and built in London clay.
B) Katya’s house is new and likely covered by warranty. A basic valuation would suffice.
C) Dan and Greg’s property is old and non standard, building survey would be sensible.
D) Iqbal has a newer property but out of guarantee. On a tight budget he could opt for Basic valuation or a condition report.
An advisor should never recommend any type of survey, they could be held liable if the survey doesn’t pick up faults that a different type of survey may have found.
Types of title -
A) absolute
B) good leasehold
C) possessory
D) adverse possession (unregistered land)
E) adverse possession (registered land)
F) qualified
A) absolute - clear title established, most secure.
B) for leases longer than 7 years. The leasehold is good but the right of the lessor (freeholder) to grant title not guaranteed.
C) owner registered but not protected from a claim by another that owned the land before registered.
D) land occupied for 12+ years without challenge from legal owner. Occupier can apply for possessory title.
E) land has been occupied for 10 years without challenge from registered owner.
F) title subject to defect in registration. Very rare.
What do the following consist of -
A) basic survey
B) desktop valuation
C) condition report
D) homebuyer report
E) building survey
A) for lender - superficial inspection. Observe interior/exterior noting obvious problems. Compares similar property prices nearby.
B) for lender - conducted within the office using software and comparing similar properties - most likely for remortgage
C) for the buyer, basic condition report for newer properties on a budget.
D) for buyer - between basic valuation and building survey. Can be valuation and survey or just survey. Basic survey to spot obvious issues. Can be used to refuse property or negotiate price.
E) thorough and detailed inspection, lifting of carpets, electrical, drains, structure, roof, gas pipes,
What is subsidence and heave?
Subsidence is when the land below the house drops unevenly (split at bottom)
Heave is where the land below the house rises unevenly (split at top)
A basic valuation is for the benefit of the lender and is paid for by the lender. True or false?
False
The basic valuation is for the benefit of the lender but paid for by the borrower
Which form of survey gives the borrower the highest level of protection against negligence from the person carrying out the inspection?
A) valuation
B) building survey
C) homebuyer report
D) condition report
B) building survey
Lenders generally require valuers to specify both the value for lending purposes and the reinstatement value of the property. True or false?
True
The value is usually different from the reinstatement price and the selling price
Which of the following would be included in both a homebuyer report and a condition report?
A) a valuation
B) issues that need urgent attention
C) advice on how to deal with remedial work
D) a report in the property’s energy efficiency
B) issues that need urgent attention
A homebuyer report is expected to to report on the existence and condition of a damp proof course. True or false?
True
It will also report on the condition of beams and rafters, also presence and severity if any dry/wet rot
A lender will not proceed with a mortgage application if a survey report indicates that a property has suffered long standing structural movement. true or false?
False
It would depend on if the movement was progressive. If it was historical it would not prevent a lender necessarily from lending.
A survey shows significant work is required on a property’s roof. The lender is likely to:
A) require an undertaking
B) impose a retention
C) insist on additional building insurance
D) require a warranty
B) impose a retention
Most likely where structural repairs are required
Karen has applied for a mortgage on a property which, although structurally sound, is in need of external and internal redecoration. What action is the lender most likely to take?
A) impose a retention
B) refuse to lend
C) reduce the mortgage offered
D) require an undertaking from Karen
D) require an undertaking from Karen
All new houses have a guarantee of either 10 or 15 years against defects. True or false?
False
This guarantee is only available if the builder is backed by the NHBC or similar insurance backed scheme
Ben bought a newly built house four years ago and it is covered by the buildmark scheme. It now requires structural repair as a result of a defect in the construction materials. Ben is entitled to:
A) require the builder to make good the property
B) claim under the buildmark insurance scheme for full cost of the repair
C) claim under the buildmark insurance scheme if the cost of the work is above the minimum claim waive
D) claim a percentage of the repair costs because the cover reduces for each year he has occupied the property
C) claim under the buildmark insurance scheme if the cost of the work is above the minimum claim waive
The builder is only liable for the first two years
