Understanding the Difference Between a Lender Mortgage Valuation and a Level 2 or 3 Survey
Introduction
When purchasing a property, understanding the types of property assessments available can be crucial for making an informed decision. Many buyers are familiar with lender mortgage valuations but might not fully understand the differences between these and more detailed home surveys like Level 2 or Level 3 surveys. In this article, we'll explore these differences, the process behind each type, and why investing in a thorough survey can be beneficial for you.
Lender Mortgage Valuation
A lender mortgage valuation is a brief assessment conducted to ensure the property is worth the amount being lent. This valuation is primarily for the lender's benefit to mitigate their risk, not to inform the buyer of the property's condition.
It's important to note that almost 50% of lender mortgage valuations are now conducted remotely. These remote valuations use advanced technology and databases to assess the property value without a physical visit. While this speeds up the process and reduces costs, it also means that the valuation might miss specific issues only detectable through a physical inspection.
Relying solely on a lender's valuation can be risky. Since it doesn't provide detailed information on the property's condition, you might be unaware of potential defects or issues that could lead to significant repair costs in the future. The lender's valuation is not a substitute for a detailed survey, and using it as such can leave buyers with unexpected problems.
Level 2 Survey (RICS HomeBuyer Report)
An RICS HomeBuyer Report, also known as a Level 2 Survey, offers a more detailed visual inspection of the property compared to a lender's valuation. It highlights significant problems using straightforward 'traffic light' ratings, focusing on urgent or significant defects that could affect the property's value.
This type of survey is suitable for conventional properties, such as houses, flats, or bungalows, that are in reasonable condition and built with common materials. It's ideal if you want a detailed inspection without the exhaustive details of a full building survey.
What's Included:
- Condition Ratings: Clear 'traffic light' ratings for different parts of the property, indicating issues that require varying degrees of attention.
- Risk Summary: A summary of risks to the building's condition and other matters like guarantees, planning, and building control issues.
- Valuation and Advice: Professional opinion on the market value of the property, an insurance reinstatement figure, and advice on repairs and ongoing maintenance.
Level 3 Survey (RICS Building Survey)
An RICS Building Survey, or Level 3 Survey, is the most comprehensive report available. It provides an in-depth analysis of the property's construction and condition, covering aspects like the roof, walls, floors, ceilings, doors, and windows.
This survey is ideal for older, larger, or more unusual properties, buildings that have been significantly altered, or if you plan major renovations. It's also suitable for properties in poor condition where more extensive examination is needed.
What's Included:
- Detailed Inspection: A thorough inspection of the property, including visible defects and potential problems caused by hidden flaws.
- Repair Advice: Detailed advice on repair options and the likely consequences of inaction.
- Additional Services: While a standard Level 3 Survey doesn't include a valuation, it can be provided as an extra service, along with estimated repair costs.
Getting a Level 2 or 3 Survey
We recommend SDL surveyors who offer a range of surveys tailored to your needs. With over 30 years of experience and a network of nearly 400 surveyors across the UK, SDL provides reliable, professional, and thorough surveys. Their innovative use of technology, including the first introduction of iPad technology for surveying, ensures efficient and accurate assessments.
Requesting a Survey
Investing in a detailed survey is a critical step in your property buying journey. To request a Level 2 or Level 3 survey with SDL Surveying, simply fill out the form below. You download their Home Survey Guide here for more information and here to view the latest price list for SDL surveys click here