Mortgage offer withdrawn

What to do if you have a mortgage offer withdrawn

Mortgage providers lending can withdraw mortgage offers at any time. This applies even if contracts have been exchanged or you have reached the completion date. This can be a huge frustration for homeowners looking to buy a home. But the good news is that there is help available.

Contact for mortgage advice today, we have a few mortgage providers lending who can help you if your current mortgage offer has been withdrawn.

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

Reasons a mortgage offer can be withdrawn

This guide will cover the most common reasons that mortgage offers are withdrawn. It is useful information for anyone who has had a mortgage offer withdrawn, regardless of whether they were involved in an exchange or not.

We have also discussed how a broker can assist you in these situations.

In our FAQ section, we answer some of the most common questions we get from customers who have had their mortgage offers withdrawn.

Can a mortgage lender withdraw a mortgage offer?

Yes. Mortgage lenders are allowed to withhold mortgage offers. They can also withdraw from the agreement once contracts have been exchanged.

A mortgage offer usually includes a section that outlines the circumstances in which you can withdraw. To prevent your agreement from falling apart, make sure you read it in its entirety.

Why would you withdraw a mortgage offer?

Lenders will withdraw mortgage offers for the most common reasons:

• Changes in circumstances
• Suspicious activity
• Problems with property
• Failure to pass further credit checks
• The mortgage offer was withdrawn

Changes in circumstances

In extreme cases, a lender may withdraw a mortgage offer if the facts provided during the application process are suddenly changed by circumstances such as a redundancy, a drastic increase in your outgoings or any other change.

Your lender may reconsider the terms of your deal. If your ability to repay the mortgage has been affected, your lender may change the amount they are willing to lend. Update the lender immediately if your circumstances have changed since you submitted your mortgage application.

For more information on a mortgage offer withdrawn because of a change in circumstances, please refer to our guide at the link.

Suspicious activity

A bank or building society may withdraw a mortgage offer if they find suspicious activity. They can pull the plug if they suspect the applicant is trying to commit property fraud or has given false information on paperwork.

Problems with property

If the property is disputed, a mortgage company may withdraw its offer. These problems could affect the property’s value or compromise the lender’s security. For example, there may be a high chance of flooding during conveyancing checks, requiring a specialist lender to facilitate a flood zone mortgage.

Your mortgage offer may not be withdrawn if a property problem is raised. It is often that the terms of the agreement are renegotiated. However, the lender can still revoke the agreement at their discretion.

Failure to pass further credit checks

Many mortgage lenders will offer an agreement in principle to borrowers without requiring a hard credit check. The soft credit search only shows the mortgage provider your basic credit score, but they will need a closer look at your finances to make a formal offer.

The mortgage underwriters will examine your credit file carefully and may reconsider your offer if there are any indications of poor credit. A hard credit check may highlight unresolved debt management issues or payday loan usage.

These issues are not usually a deal-breaker. Many lenders will consider offering bespoke mortgages to customers with poor credit ratings. But in the worst-case scenario, they could lead to you being denied a mortgage.

The mortgage offer was withdrawn

Most mortgage offers are valid for a limited time. The mortgage lender can withdraw from the agreement if you do not complete the loan within that time frame.

Most offers last for six months. Some offers may be extended for as little as 12 months. It is possible to extend your offer if you have difficulty meeting the deadline, but this is becoming increasingly difficult. If you are near the expiration date of your offer, speak to your solicitor.

What happens if a mortgage offer is withdrawn?

Any mortgage lender can withdraw an offer anytime, even after exchanging contracts. This applies to all phases of the process, from beginning to completion. Your mortgage offer will detail all circumstances that might cause it to occur. However, if you have any questions, a mortgage broker can help.

The steps to take if your mortgage offer has been withdrawn will vary depending on where you are in the home-buying journey. Continue reading for more information.

Is it possible to withdraw a mortgage offer after the exchange of contracts?

Yes. Some mortgage offers can be withdrawn between completion and exchange. This is rare, but it can happen due to the reasons we discussed in the previous section.

• The circumstances of the applicant changed
• Incompatibility with the legal title
• Late on, suspicious activity is discovered
• The offer was cancelled
• Incorrectly filled in the application
• The criteria of the lender have been changed

A mortgage offer being withdrawn late can lead to high costs as the borrower may be responsible for the full cost of the loan. If the mortgage offer were withdrawn due to a breach of terms, none of these costs would be repaid.

There are several ways to reduce the chances of your mortgage offer being withdrawn before completion.

• Be sure to inform your lender about any changes in circumstances
• If you are having difficulty finishing on time, talk to your solicitor to request an extension
• Ask a mortgage broker for assistance with paperwork. You can ensure that everything is done correctly and can address any issues before you sign.

If your mortgage lender withdraws your offer, contact them to get all the details. We’ll match you up with a mortgage broker if you cannot negotiate the terms of your deal.

On the day that it is completed

Mortgage lenders will usually have identified any deal-breaking issues well before the deadline, so it is rare for mortgage offer withdrawals to be made on completion. However, they do happen in certain circumstances. These include…

• Your situation has changed, and the lender realised this only on completion day.
• Lately, a defect in the legal title has been discovered.
• Before completion, suspicious activity is detected
• The offer was cancelled
• Your application form was incomplete.
• The criteria of the lender have been changed

What to do if your mortgage offer was withdrawn at the completion time?

Your solicitor should be consulted if you have a mortgage offer withdrawn before completion. You will almost certainly face legal fees at this stage. Talk to a mortgage broker about your options moving forward.

Your broker can negotiate with the lender if there’s room. If the deal is not reached, they can advise on how to save your mortgage plans.

Is it possible to cancel a mortgage after the completion of a project?

Technically, yes. However, if you don’t pay your mortgage on time or violate the terms of your agreement, your lender may take legal action against you and ask the courts for your property to be repossessed.

These are some tips that will help you avoid it from happening.

• Be sure to keep your lender informed about any changes in circumstances
• If you are having difficulty paying your mortgage payments, contact your lender immediately. There may be a way to work around your financial problems, such as a mortgage payment vacation or an extension of the term.
• If you are struggling financially, contact Citizens Advice
• Talk to a mortgage broker to get bespoke mortgage advice on your mortgage options

What do I do if my mortgage offer has been withdrawn?

Don’t rush to make decisions. You don’t want to rush to another lender for the sake of expediting your application elsewhere. This could lead you to the same problem again. A history of rejections in a short period could lead to a negative credit score and impede your prospects of obtaining a mortgage.

If your lender has not been able to resolve the issue that led to their withdrawal of the offer, you should contact us to enquire about our ability to match you with a broker in the whole market.

Our free broker-matching service will match you with the right mortgage advisor for your circumstances. They will search all available markets for you and find the best offers that are most likely to be accepted by borrowers with your profile.

An informal chat with a mortgage broker will not cost you anything, but it could save you money, time, and possibly disappointment.

Talk to an expert mortgage broker for advice now

We can help you find the right mortgage broker for you if your mortgage application has been withdrawn.

A broker can help with this type of situation. A mortgage broker is best to give you personalised advice and search the entire market for an alternative lender for future mortgage prospects. This will ensure a more successful outcome.

Different mortgage brokers may have different expertise. Depending on your specific needs and circumstances, some will be more equipped than others to handle your case. With our broker-matching service, you can be sure that you will be introduced to the right expert, which could help you save time and money.

Reapplying to another lender immediately could damage your chances of getting a mortgage. Although it is possible to get rejected again in a very short time, your creditworthiness could be affected by this. However, with the assistance of our brokers, there are fewer chances that you will end up with the wrong lender.

For a no-obligation chat, enquire online today.

Withdrawn mortgage offer FAQs

How often do mortgage offers get withdrawn?

Most mortgage lenders will not withdraw mortgage offers unless it is necessary. They will often explore possible workarounds, such as changing the terms of increasing the amount they are willing to lend. Withdrawals are rare after the exchange of contracts because any issues that could have been detrimental to the deal should be resolved by then.

Am I more likely to see my mortgage offer withdrawn in 2020 or 2021 than in other years?

The coronavirus pandemic has made it most likely that the answer is yes. The COVID-19 pandemic has had a significant impact on the property market. Interest rates dropped, and many lenders pulled their products from the marketplace. This has led to more offers being withheld, deals being delayed, and agreements being cancelled.

The good news is that things have been much better since the UK’s first national lockdown in spring. Some lenders have eased their criteria, and more products are available daily.

For more information, contact a specialist broker if you have had your mortgage offer withdrawn because of COVID-19.

Can my mortgage offer be withdrawn while I am on furlough

The mortgage lender may be able to do this. Your mortgage provider may consider suspending your loan if your employer placed you on furlough due to affordability concerns or concerns about your job security.

You might consider looking for another lender more open to working with furloughed customers. Many lenders changed their criteria during the COVID-19 crisis. It is important to seek specialist advice before entering the market. It is not a good idea to do it all yourself.

Can I cancel my mortgage application?

Yes. You can cancel your mortgage application at any time up to completion. However, if the process is advanced, you may be subject to some non-refundable fees.

Talk to your lender about these implications, and remember that brokers we work with can provide specialised advice regarding your mortgage application.

If I was made redundant, could my mortgage offer be cancelled?

Yes. Redundancy can lead to a mortgage offer being withdrawn at any time up until completion. This would be considered a change in your financial circumstances. Contact the lender immediately if you have lost your job.

Your circumstances will determine whether the lender will cancel the offer or modify the terms. It might still be possible for you to get a mortgage if the joint mortgage application was approved and the debt is not more than your partner’s monthly income.

Contact us now for better mortgage advice if you have had an offer withdrawn