MyRate Education Centre
Valuations
Before taking out a loan, your lender will commission an independent valuer to value your property. The valuation is based on the state of the property as well as evidence of recent sales of similar properties in your area. The valuation is typically valid for 3 months.
The valuation figure will affect your LVR (Loan to Value Ratio) and this in turn will determine whether you pay LMI (Lenders Mortgage Insurance). Lenders usually require LMI to be paid where the LVR exceeds 80%.
The value of your property used to determine the LVR of your loan is determined by either the valuation figure or purchase price, which ever is lower.
Formula for working out LVR
Use our calculator to work out your LVR.
Unacceptable 'valuations'
Most lenders will not accept the figures below to determine the value of your property
- if the valuation is done by yourself;
- council rates notice or;
- a real estate agent estimation
Don't agree with a valuation?
The company that values your property is completely independent. Lenders, such as MyRate, do not have any influence as to the valuation figure. However, if you do not agree with a valuation, MyRate can help you challenge the valuation.
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