Buying a home can be a daunting experience. The mortgage process is not only the most important thing to understand, but arguably the most confusing. That’s why we’re here to help you get to the bottom of your most pressing questions so that you can begin your first time buyer journey.
If you’re a first time home buyer looking to demystify mortgage offers, read on. This blog post will provide a whistle stop tour of everything you need to know about mortgage withdrawals and extensions.
Can a mortgage be withdrawn?
You may or may not know, but a mortgage lender has the right to withdraw an offer at any point during the mortgage process. This can even be after exchange of contracts, so be sure to read the terms and conditions within your contract before signing. Here are some of the common examples:
Mortgage offer expiring – If your mortgage, for whatever reason, goes beyond the initial agreed period, the lender has the right to withdraw. As you’ll see in the next section, there are ways around this.
Further credit checks – It might be the case that the lender chooses to do a more rigorous credit check after agreeing an offer in principle. In this case, if something were to show up that concerned them, then they reserve the right to withdraw the offer.
Misleading information – If the lender were to find purposely misleading mistakes in the application, then they can choose to withdraw. This could be anything from property fraud all the way to omission of information.
Change of situation – During the mortgage process, it is not uncommon for circumstances to change. This could be a redundancy for example, or even a criminal conviction of some sort. Depending on the severity of the situation, this could result in a change of terms, or even, in the case of a criminal conviction, a withdrawal.
Property issues – Sometimes further conveyance checks on the property can bring to light issues not originally flagged. This could be flooding issues or structural damage, for example, which might result in the lender withdrawing.
Can mortgage offer be extended?
There will inevitably be bumps in the road when purchasing a property. Whether its delays in construction or legal hold ups, the process can be long-winded and complicated. Don’t worry though, because mortgage lenders understand this and are, in most cases, happy to extend a mortgage beyond the initial agreed period.
Mortgage offer extension
When this happens, make sure to keep a clear dialog with your mortgage lender, keeping them up to date with your progression and letting them know early if there is something that might stall the process.
The length of the extension will depend on your lender. They may ask for proof of bank statements to ensure nothing has changed since the original agreement.
Hopefully you’ve found this guide through the process of withdrawals and extensions helpful. Our first time buyer guide has loads of information about getting onto the property ladder, from start to finish, so do check it out.