Mortgage change of circumstance rules

Mortgage change of circumstance rules

The process of buying a house can take a while. This means that a change of circumstances does happen.

Your mortgage lender or mortgage broker will need to discuss any changes that affect your mortgage application.

Each step in the home-buying process brings you closer to closing the mortgage offer and getting the keys.

Use our online mortgage calculator as a guide for your monthly repayments now

What to do if your circumstances change when applying for a mortgage

If you accept a mortgage offer from a lender but have experienced an unexpected change in your life, the final step of completion might seem far away.

This can happen more often than you think. If your circumstances change after receiving a mortgage offer, it’s best to talk to a qualified mortgage advisor to help you move forward.

Constitute financial advice today to discuss change of circumstances or to find mortgage providers lending to difficult situations.

We have a few mortgage providers lending so we are sure to be able to help you receive the best mortgage offer on the market.

What happens to my mortgage if there is a change in circumstances?

You may be wondering what to do next if your situation changes after you accept a mortgage offer and you no longer meet the lender criteria. Firstly, don’t panic and constitute financial advice straight away.

Although you may be certain that everything will go well and that you can afford the mortgage, you should let your solicitor and mortgage lender know if there is a significant change of circumstances.

Even if your solicitor or mortgage lender doesn’t know, it is possible for them to take any final checks before releasing funds. This could end up costing you dearly and, in a worst-case scenario, lead to them withdrawing their offer. You may also be given additional notes that could be used to help you with future applications.

If you do not notify the mortgage lender of any changes in your circumstances before the mortgage is completed, they will be able to seize your property if they consider the mortgage unaffordable or inappropriate.

If they are not happy to accept your change of circumstances, you can choose:

• Accept their offer if it is one
• Consider a new mortgage offer that is based on your changed circumstances. However, you will need to tell your new lender about the events with your old one.

An experienced mortgage advisor can help people affected by changes in their financial situation. They can help you determine the best course of action and recommend other lenders that may be able to offer you a better deal.

Contact our mortgage brokers today to provide mortgage advice free of charge with no obligation. All mortgage subjects can be discussed, the exclusive mortgage expert will offer tailored advice specific to your mortgage requirements.

What could change in your life that might affect your application for a mortgage?

Most mortgage offers include a clause in the small print that states that you must notify your lender of any material changes to your circumstances.

These are just a few examples:

• Any (negative), change in your credit score
• Significant income change (especially if it is lower)
• After being an employee, you’ve decided to be self-employed.

• You wish to make changes to the property that you are interested in buying or to remove the old one.
• The applicant is seriously ill.
• Becoming bankrupt
• A valuation that is significantly higher than your mortgage offer

These changes have a direct impact on your ability to pay your mortgage repayments back and your personal finances. A mortgage broker can help you in this area. A mortgage broker will help you understand the reaction of a lender to the above changes and advise you on how to get a mortgage.

What are the rules regarding mortgage offers and a material alteration of circumstances?

Each mortgage lender has its own terms and conditions. You will need to review any documentation you have to determine what constitutes a change in circumstances.

If you are suddenly made redundant or have other life changes, we can help. Your mortgage lender will need to be aware of any potential negative effects on your finances or make your mortgage repayments more expensive.

Do I need to notify my change in circumstances regarding my mortgage offer?

You must notify the lender if you notice any changes in your financial situation that could affect your ability to repay your mortgage term.

If you have to cut back on your work hours for any reason, it could mean that your mortgage may be out of reach.

You might also consider a pay rise, which would make it easier for you to manage your mortgage. In this case, you wouldn’t have to notify the lender.

Talk to one of our experts if you are unsure. They will be able offer the best advice for different mortgage subjects. If the offer you have accepted has been withdrawn because of your changing circumstances, our specialist finance team can help you search for an alternative mortgage.

What if my circumstances have changed and I am unable to get a mortgage?

Your lender will consider your application if your circumstances have changed. However, it all depends on the nature of the change and how it impacts your ability to pay a loan.

Even if a lender withholds a mortgage offer you may still be eligible for a mortgage.

What should I do if my situation changes after receiving an offer from a mortgage lender?

You must immediately inform your lender if your personal circumstances change for any reason. Don’t panic if the offer is withdrawn. There are steps you can immediately take to help your mortgage application get back on track.

• Make sure you have all your documents updated: Gather all paperwork related to your financial situation and new circumstances. You will need to update or create a new mortgage application. It will be easier to complete the process if you have all of your paperwork. This will allow you to answer any questions you may have when speaking with your lender or mortgage adviser. The complete list of documents required for mortgage applications can be found in our guide.
• You should check your credit file reports If your financial situation has changed, this is particularly important. You can prepare for any questions that a new lender may ask about your financial situation by knowing the most recent details about you. You can also verify that your credit reports are accurate and make necessary corrections. It’s easy to access your credit reports via our credit report hub.
• Talk to a Mortgage Broker: Gather your paperwork and speak with a mortgage introducer who is experienced in helping people in your position secure a mortgage. The broker will review your application and discuss your circumstances. They can also advise you about any rules that may apply to your mortgage offer. Your broker can help you apply with a new lender, if needed, and guide you through the process to make it simpler and more likely that you will be approved.

How will my credit rating be affected by my new circumstances and the possible withdrawal of a mortgage?

Your credit score won’t be affected by changes in your financial situation, except if you miss debt payments.

If a lender approves a mortgage, but withdraws it later due to a change in circumstances, this will likely be on your credit report. This is because credit files include all mortgage and credit applications, as well as whether or not they were approved for a mortgage.

Why use a mortgage broker?

Talking to a mortgage advisor like the ones we work with is one of the best ways to avoid this. After you have experienced a change in your circumstances, they can help you understand how mortgage affordability is calculated from the lender’s point of view.

A mortgage broker can also help you apply to a mortgage with a lender who will likely approve your application, despite any changes in your circumstances.

Talk to a mortgage advisor for advice on your mortgage offer and changes in circumstances

Don’t panic if you receive a mortgage offer on a home that you are interested in buying but your circumstances change unexpectedly. Contact us today to make an enquiry.

Our experts are impartial and don’t charge any fees so contact us today for the best advice.