What to Do if Your Mortgage Valuation Lower Than the Offer?
Updated: July 2025
If your mortgage valuation is lower than your offer, your lender will only lend on the lower amount, which means you’ll need to renegotiate the price, pay the difference, or look for alternatives. This is common and doesn’t have to derail your purchase, but you must act quickly: Discuss options with your broker, lender, and the seller as soon as possible to keep your transaction moving forward.
Key Takeaways:
- Most buyers negotiate a lower price with the seller.
- You can appeal, pay more deposit, or try another lender.
- Get quick advice from your broker and solicitor.
6 Reasons Your Mortgage Valuation Is Lower Than the Offer
1. Market Volatility: Economic ups and downs, policy changes, and unexpected events (like pandemics) can quickly affect property values, sometimes leading to lower valuations than agreed sale prices.
2. Property Condition: Issues with the house structure, outdated systems, or poor energy efficiency reduce value. Well-maintained, modern homes with recent upgrades are worth more.
3. Location Factors: Desirable locations with good schools, low crime rates, and strong amenities tend to boost value. Conversely, negative trends or poor local infrastructure can lead to lower prices.
4. Comparative Sales (“Comps”): If recent sales of similar properties nearby are lower, surveyors will base your home’s valuation on those figures, even if asking prices are higher.
5. Overvaluation: If the seller’s price is unrealistic due to wishful thinking, speculation, or emotional attachment, the valuation will reflect the true market value, not the listing.
6. Economic Factors: High interest rates, rising inflation, or economic uncertainty make lenders and valuers more cautious, often resulting in lower valuations.
Why Mortgage Valuations Are Sometimes Lower Than the Offer
Mortgage valuations are often lower than the offer price because lenders want an independent view of a property’s real market value, not just what a buyer agrees to pay. Valuers look at recent sales, the property’s condition, and market trends to protect both lender and buyer from overpaying or borrowing too much. If your offer is above local sales or the market is cooling, the valuation may come in lower to avoid lending more than the property is realistically worth.
According to Which?, around 17% of UK home purchases fell through in 2023, with down-valuations by lenders being a leading cause. This highlights the importance of understanding the risks and planning for various valuation outcomes.
What Happens If the Valuation Is Lower?
If your mortgage valuation comes in below the offer price, you’ll face a financing gap. Your lender will only provide a mortgage based on their lower valuation, not the agreed offer. This often puts pressure on buyers to find extra funds or renegotiate. Sellers may need to accept a lower price or risk the sale collapsing, which can also disrupt the house chain and delay multiple moves.
HB4u Case Examples
| Buyer Offer | Lender Valuation | Typical Renegotiated Price |
|---|---|---|
| £300,000 | £285,000 | £288,000–£290,000 |
| £250,000 | £240,000 | £242,000–£245,000 |
| £400,000 | £385,000 | £387,000–£390,000 |
Expert insight from our property expert Paul Gibbens:
“We see around one in five sales hit a snag because of a low mortgage valuation. When that happens, it’s vital to act fast, talk to your broker, negotiate with the seller, and look at all your options. Most issues can be resolved if everyone’s flexible, but ignoring the gap nearly always leads to disappointment.”