When there is prospective borrower, bank (normally sales officer) will call their panel valuer to check indication of the value (usually referred as INDICATION). This is by desktop checking of which this valuer will estimate the value without doing the inspection, just based on their data (i.e recent similar transaction, precedent similar cases, asking prices in the market).

In valuer perspective, all INDICATION are rough estimation. The indication value is not confirm as Fair Market Value (FMV). Confirmation of actual FMV is when the formal valuation report is done, which is after inspection and seeing the property.

Meanwhile, in bank perspective, they take this INDICATION as good to use as confirm market value as they need to approve the loan first and will conduct formal valuation after the borrower accepted the Letter of Offer (LO)

Some cases, indication and formal valuation value different. Valuer will access the FMV based on actual inspection. Any changes on site will effect the value. Bank normally will based whichever is lower. If the indication is higher than actual FMV, the bank have the right to amend downward the loan amount or pull back the facilities.

So don't think you got your LO, you are safe!! you are wrong dude!

This is not the best practice actually, however mostly the banks in Malaysia practice this. Maybe due to the stiff competition to get acceptance from borrower, so who ever issue the fastest Letter of Offer (LO) and give lower interest rate will get the client!

There is a local bank practice that prospective borrower will be required to bring a formal valuation when applying the loan. The prospective borrower have to select from their panel valuer list and appoint them to conduct valuation. The panel valuer will go for an inspection and prepare the formal valuation report. When the formal valuation report completed, borrower bring together with the application form and submit to the bank and wait for the approval. Valuation cost is bared by the borrower upfront. I personally like this way..it more safe. Although it will delay, the approval process, as to prepare formal valuation report normally takes about 2 weeks, it sure give me peace of mind, and as property owner, i can know my current market value of my property.

As valuer is guided by their professional enactment and also valuation standard, the different of value opinion between valuers is not much, plus minus is still within the same range.

There is a lot factor contributing to different opinion of value :-

1) Price and value

Price and value is different. You may purchase it higher or lower from market prices.

2) Information

Information given during the indication of value is insufficient. The valuer might not get the true picture about the property, especially about the additional factor that can attribute to the value such as i.e renovation details, extension, renovation cost, location of the site near playground or near oxidation pond?

It is advisable that we give proper information about the property, you should also attached photos external and internal, floor plan, renovation cost details and etc.

Established private valuation firms such as Jones Lang Wooton, CH William, Colliers..full listing of private valuer you can get in Board of Valuer Malaysia website..

But frankly, I haven't heard value is based by name...by internal record..it might possible as a cross check reference with indication...

Hong Leong Bank check value base on customer name...

cheers..

just my 2 cents.

Also for one bank, the property value you get may depend on your name 

Strange but true...

I was told that if I sign the Letter of Offer (LO), only will the bank send the valuer to physically evaluate the property. I dont lose anything if I dont sign the Loan Agreement. Is this true?

P/S: I have not paid any deposit to the agent.