Checked by Connor Fitzgerald, Founding Director
Did you know that mortgage offers can be withdrawn at any point between being offered up until contracts have been exchanged?
One of the most asked questions when applying for a mortgage is ‘Can a mortgage offer be withdrawn?’ In this blog post, we will answer that query and highlight several of the reasons why a mortgage offer could be withdrawn and what to do if it is.
In short, yes, a mortgage offer can be withdrawn by the chosen mortgage lender at any time after it’s been issued. As a mortgage offer is not legally binding, the provider can withdraw if new information or a change of circumstances is brought to light. Offers or mortgages in principle, are often valid for around six months, spending on the lenders and in most cases should not be withdrawn.
Whether you’re moving homes, purchasing your first home as a first-time buyer, or looking for a buy to let opportunity, it is important to understand that mortgage offers can be withdrawn and the potential reasons behind it.
Mortgage offers won’t be withdrawn without a reasonable reason or cause. In most cases, mortgage offers will be revoked if the agreement terms have been breached, regardless of whether they were broken intentionally or as an accident. Some reasons that your mortgage offer would be withdrawn include:
As previously stated, all mortgage offers will only be valid for six months. This will give you time to find an offer on your dream home, as well as (hopefully) giving you time to complete all the relevant paperwork for the house purchase.
However, if you’ve not completed (legally bought the house and signed all paperwork) by the end of your six months, your mortgage offer will expire and will therefore be null and void. You may then have to reapply for the mortgage. You can find out more about purchasing in our blog post: ‘A guide: first-time buyer mortgage advice.’
Sometimes, if you’ve had a change in current circumstances since applying for your mortgage, i.e:
Then lenders may decide to either withdraw their mortgage offer or adapt their offer to accommodate your new circumstances. If you’re worried about maternity leave and mortgage applications, or if your life situation has recently changed, chat with a member of our team and we will be more than happy to assist.
Before a mortgage application is authorised, the lender will carry out a wide range of extensive credit checks on those applying. This includes a ‘hard credit check’ which will highlight any issues on the borrower. Sometimes, lenders will run a second credit check after the offer has been authorised, and this second credit check can occur at any time within your offer timeline.
This is why it is important to declare if your credit file changes in any way. For more information about what can affect your credit score, see our blog post, 5 ways to boost your credit score with our Yeovil Mortgage Advisors.
When purchasing a property, there are a lot of steps you need to take before you sign the papers and legally exchange on the property. In that time, issues may arise which could improve the value of the property and potentially comprise your agreed loan from your lender.
In these situations, a provider may withdraw their offer, or change the terms of the agreement, potentially by increasing or decreasing the amount they’re willing to lend you.
It can be incredibly frustrating and difficult to find that after you’ve applied for (and had your mortgage offer accepted) you’ve had your offer withdrawn. However, don’t fret! At The Levels Financial, our team of expert mortgage advisors are on hand to help you.
Lenders are within their right to withdraw a mortgage offer anytime between sending the offer and the exchange of contracts. This is why we want to ensure all of our clients are aware of what the next steps should be, should they find themselves with a withdrawn offer:
1) Try not to make any rash decisions, we understand that this is a stressful situation, but making any rash decisions, such as pulling out of the purchase or informing the seller, could potentially impact you further.
2) You should reach out to your lender or mortgage advisor and request a reason as to why your mortgage offer has been revoked. Understanding the reason behind the withdrawal can help you prevent the same issue from arising again.
3) Check all of your accounts and paperwork and decide if this was made in error. If you think the decision was made in error, it is important to reach out with your evidence as soon as possible.
4) Check the dates and see if your offer has expired.
5) Get in touch with our local, Yeovil, Taunton or Exeter mortgage advisors, and find out more about working with our team, in our blog post here: ‘A guide on how Mortgages work with our Mortgage Advisors Yeovil’.
At The Levels Financial, we love helping our clients move into or purchase their dream property. However, we know that it is not always as smooth a process as we would like. This is why our highly-trained and experienced team are experts in all aspects of the mortgage process, from initial mortgage applications to the day of completion.
For more information, or to see how we could help you, contact us today to book your free no-obligation consultation, email us at admin@thelevelsfinancial.co.uk or call us on 01458 772040.
Because we always have your best interests at heart, you need to know…
