In May this year, the Bank of Spain and Spanish government passed a new rule that reduces the validity of valuation reports from 6 months down to 3 months.
This change is a reflection on the volatility of values of properties in Spain and the Bank of Spain’s requirement to ensure that loans do not exceed acceptable loan to values.
No bank can now accept or complete on a Spanish Mortgage without having a formal valuation, which is less than three months old.
Timing therefore of undertaking valuations will have to be much more closely monitored to ensure completion of purchase is likely to happen within the three months or the client will suffer having to instruct and pay for another valuation.
It will be impossible to get this right every time as many issues can affect completion dates in Spain even when it appears reasonably clear completion can take place within given timescales.
The new rule should not affect valuations already undertaken as each valuation report stipulates a validity date. Certain banks however may chose to take a different view and insist a new valuation takes place if current one is more than three months old. What is in fact law and what criteria the bank then insists on does not always match.