Your guide to remortgage valuations

What is a remortgage valuation?

A remortgage valuation is an assessment of your property’s current market value, carried out by your new (or existing) mortgage lender. It helps the lender decide:

• Whether the property is suitable security for the mortgage
• How much they're willing to lend you
• What interest rate and loan-to-value (LTV) bracket you fall into

How does a remortgage valuation work?

Once you apply for a remortgage, your lender will arrange a valuation. In most cases, lenders will carry out this valuation remotely based on recent sales and market trends. But some lenders may carry out an in-person valuation if the case is more complex, or if you're borrowing a large amount.

If the lender chooses to carry out an in-person valuation, they may send a surveyor to inspect the outside and inside of your property. However, it’s more common for an agent to make their assessment from the outside alone, in which case you won’t have to let them into your home or show them around. 

The lender will then use this valuation to decide how much to lend you and finalise your mortgage offer.

Learn more: How to remortgage your house

Do you need a valuation to remortgage?

Usually, yes. Lenders want to confirm the current value of the property before agreeing how much to lend to you. However, if you’re remortgaging with the same lender (often known as a product transfer), a valuation might not be required, especially if you’re not increasing the loan amount.

With a Tembo plan, you can see whether staying with your current lender or switching to a new one is better for you. Create your free plan today.

How to get a valuation for a remortgage

When remortgaging your home, you usually don’t need to organise the valuation yourself. Your lender or broker will arrange the valuation on your behalf.

Some lenders offer free valuations as part of a remortgage package, but others may charge a fee, especially if they need to carry out a more in-depth inspection. 

If you remortgage through a mortgage broker, your broker will usually know which lenders are most likely to carry out an in-person valuation and which are more likely to make their assessment based on market trends and recent selling prices. 

What happens if my house is worth more when I remortgage?

If your home has gone up in value since you first bought it, this is good news because it means your Loan to Value (LTV) will be lower.

A lower LTV could give you access to:

• Better mortgage rates
• More products to choose from
• Potential to release equity, if you want to borrow more against the increased value

Lenders tend to offer their best rates to borrowers with a lower LTV, so rising property values could mean lower monthly payments and big savings over time.

So let’s say that your home’s valued at £250,000. You have a mortgage of £100,000, meaning you have £150,000 of equity and an LTV of 40%. 

This is a really good LTV, so as long as you can meet the lender’s affordability criteria, you should have plenty of options when remortgaging.

If you wanted to remortgage to fund home improvements, for example, you could increase your mortgage to say £120,000 and use £20,000 for a new kitchen or bathroom. 

Your LTV would increase to 48%, which is still strong enough to secure a good mortgage rate and keep your repayments at a manageable level. See what rates you could be offered without applying with a Tembo plan.

What happens if my house is worth less when I remortgage?

If the surveyor says that your property is worth less than you thought it would be, this is known as a ‘down valuation’. 

Let’s revisit the previous example, where you have a mortgage of £100,000. If your valuation puts your property’s value at £200,000, this gives you an LTV of 50%. This is still a good LTV and you should still be able to remortgage, as long as you meet the lender’s criteria. 

But if you’d still like to borrow £120,000 (including £20,000 for home renovations) your LTV will increase to 60%, which may come with a higher interest rate and higher monthly repayments.

You may be able to appeal a down valuation, but you’ll need to produce solid evidence, including at least three examples of similar properties in your area that have sold for a price closer to your own expectations. 

Whatever your reason for remortgaging, you can make the process easier (and potentially avoid having to appeal a down valuation) by working with a trusted mortgage broker like us. 

Learn more: What is the lowest LTV on a mortgage?

How long does a remortgage take after a valuation?

Once the valuation has been completed, you’ll usually receive a mortgage offer fairly quickly. At Tembo, our average wait time from application to offer is just 10 days. But this can vary depending on whether you're changing lenders, borrowing more, or doing a product transfer.