You’ve found the one.
The photos looked amazing.
The viewing went well.
You’ve already mentally decided where the sofa is going.
Then your mortgage lender says:
“Don’t worry, we’ll arrange the valuation.”
Perfect.
One less thing to think about.
Except…
A mortgage valuation and a home survey are not the same thing.
Think of it like someone checking that a car is worth enough to secure the finance while you assume they’re also checking the engine, brakes and suspension.
Same property.
Very different objectives.
And confusing the two can leave home buyers discovering expensive defects only after they’ve committed to the purchase.
Buying a property?
Find out whether a Level 2 or Level 3 Survey is appropriate for the home you’re purchasing.
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The Biggest Myth in Home Buying
People hear:
“The bank is doing a survey.”
What they often think is:
“Someone is checking the house for problems before I buy it.”
But that’s not what a mortgage valuation is designed to do.
The lender is primarily interested in whether the property provides suitable security for the mortgage they’re considering.
An independent home survey has a different purpose: helping you understand the condition of the property you’re about to buy.
One primarily supports the lender’s decision.
The other gives you information about the property.
That’s an important distinction when you’re potentially committing hundreds of thousands of pounds to a purchase.
What Is a Mortgage Valuation?
Despite sometimes being referred to as a “mortgage survey”, it is generally a mortgage valuation.
Its purpose is primarily to help the lender decide whether the property represents adequate security for the proposed mortgage.
The lender isn’t commissioning it to provide you with a detailed assessment of the property’s condition.
It isn’t a substitute for an independent home survey.
Depending on the lender and property, the valuation may involve a physical inspection, a limited inspection or, in some circumstances, an automated or desktop valuation using existing property data.
The key point is simple:
The mortgage valuation is for the lender’s purposes.
If you want to understand the condition of the property you’re buying, you should consider commissioning your own survey.
Wait… They Might Not Even Go Inside?
Potentially, yes.
The approach taken to a mortgage valuation depends on the lender, property and circumstances.
Some involve an inspection.
Others may be completed using property information, comparable evidence and other available data without the type of detailed inspection a buyer might assume has taken place.
Imagine buying a used car because somebody confirmed:
“Yes, it’s worth roughly what you’re paying for it.”
Useful information.
But you’d probably still want to know whether the engine was about to fail.
A house is no different.
So What Does a RICS Home Survey Do?
A home survey approaches the property from a very different perspective.
Instead of primarily asking:
“Is this property suitable security for the proposed lending?”
you’re commissioning a surveyor to help answer:
“What condition is this property actually in, and what do I need to know before I buy it?”
A RICS home survey can identify and report relevant visible defects, explain their significance and highlight matters that may require further investigation.
Depending on the level of survey and the property, this might include issues relating to:
- Roofs
- Damp and moisture
- Walls and structural movement
- Floors
- Windows and doors
- Drainage
- Insulation
- External elements
- Alterations
- General condition and maintenance
It gives you information about the building before you commit to owning its problems as well as its benefits.
Mortgage Valuation vs RICS Home Survey
| Mortgage Valuation | RICS Home Survey |
|---|---|
| Primarily for the lender | Commissioned for you |
| Assesses the property for lending purposes | Assesses the property’s condition |
| Scope may be limited | Provides a more detailed inspection |
| Not designed to identify every defect | Identifies and reports relevant visible defects and risks |
| Supports the mortgage lending decision | Supports your purchasing decision |
| May involve limited or no physical inspection | Physical inspection appropriate to the chosen survey level |
A mortgage valuation helps the lender understand its lending risk.
A home survey helps you understand the property you’re buying.
“But the House Looks Fine.”
Of course it does.
Nobody puts mould in the estate-agent photos.
Nobody uploads a glamorous picture titled:
“Bedroom Three – Featuring Active Roof Leak.”
Many property defects aren’t obvious during a 20-minute viewing.
Damp can hide behind furniture.
Timber defects can exist beneath floors.
Roof defects can be difficult to see from ground level.
Cracking may have been redecorated.
Previous leaks may have been painted over.
And problems that look insignificant to an untrained eye can sometimes warrant further investigation.
The property isn’t necessarily hiding anything from you.
You simply haven’t had the opportunity to inspect it properly.
Fresh Paint Is Not a Structural Repair
Fresh decoration can make almost any property look fantastic.
But paint can also cover evidence of:
- Previous damp staining
- Hairline cracking
- Historic leaks
- Poor repairs
- Deteriorated finishes
Paint is brilliant at making houses look better.
It isn’t quite as good at repairing them.
That doesn’t mean every freshly decorated property has problems.
It simply means appearance alone doesn’t tell you everything about condition.
“It’s a New Build. I’ll Be Fine.”
Hopefully.
But “new” doesn’t automatically mean “perfect”.
Newer properties can still experience defects associated with workmanship, detailing and installation.
Potential issues can include:
- Roofing defects
- Insulation deficiencies
- Plumbing issues
- Poor finishing
- Incomplete works
- Ventilation problems
- General workmanship defects
A newer property may require a different approach from an older building, but age alone shouldn’t be the only reason for deciding whether further inspection is worthwhile.
Humans built it.
Humans occasionally make mistakes.
The Maths Is Pretty Simple
A home survey represents a relatively small cost compared with the overall amount you’re committing to a property purchase.
Now compare the cost of obtaining information before exchange with discovering afterwards that the property requires:
- Major roof repairs
- Damp investigation and remedial works
- Structural repairs
- Timber repairs or replacement
- Drainage works
- Significant external maintenance
- Further specialist investigation
Suddenly, understanding the property before you exchange contracts can look rather inexpensive.
And there is another potential financial benefit.
If significant defects are identified before exchange, you still have options.
After completion, those defects are generally your problem.
Which RICS Home Survey Do You Need?
Not every property requires the same level of survey.
The appropriate survey will depend on factors including the property’s age, construction, condition, alterations and your plans for it.
RICS Level 2 Home Survey
A Level 2 Survey is often suitable for conventional properties that appear to be in reasonable condition and aren’t unusually complex or extensively altered.
It provides an assessment of the property’s condition and highlights matters that may require attention or further investigation.
RICS Level 3 Home Survey
A Level 3 Survey provides a more detailed assessment and may be appropriate for properties that are:
- Older
- Larger or more complex
- Unusually constructed
- Extensively altered
- In visibly poor condition
- Known or suspected to have significant defects
- Being purchased with substantial works or renovation in mind
Not sure which one you need?
Tell us about the property and we can help you identify the appropriate level of survey.
Can a Survey Actually Save You Money?
Potentially, yes.
Not because surveyors arrive carrying magical discount vouchers.
Because information has value when you’re negotiating a property purchase.
If significant defects are identified, the findings may help you make a better-informed decision before exchange.
Depending on the circumstances, you may decide to:
- Discuss the purchase price with the seller
- Request that particular matters are investigated
- Obtain quotations for repairs before exchange
- Budget for works after completion
- Ask for additional specialist investigations
- Reconsider whether the property is right for you
The important thing is that you can make those decisions before you’ve committed to owning the property.
A relatively small problem discovered before exchange is information.
The same problem discovered after completion can become an invoice.
The Bottom Line
Here’s the difference in simple terms:
A mortgage valuation is primarily for your lender.
An independent home survey is commissioned for you.
Your lender will make its own assessment of the property for mortgage purposes.
You should consider whether you want someone independently assessing the condition of the property for your benefit.
Especially before making what may be one of the largest financial commitments of your life.
The Royal Institution of Chartered Surveyors (RICS) provides independent guidance on the different types of home surveys and when each may be appropriate.
Read the RICS Home Survey Guidance
Get Your Independent Survey Quote
Buying a property?
At Sterlingworth Surveyors, our experienced RICS surveyors provide independent Level 2 and Level 3 Home Surveys to help buyers understand the properties they’re purchasing.
Not sure which survey you need?
Tell us about the property and we’ll help you identify the appropriate level of survey.
We’ll explain what we’ve found, why it matters and what you may need to consider before proceeding.
Clear advice. No unnecessary jargon.
So you can make your next move with a better understanding of the property you’re buying.
Get a Residential Survey Quote
