Mortgage Declined After Exchange

Exchange of contracts is one of the final stages of the property-buying process. This is the point where you'll sign a contract confirming that you're buying the house, and the seller will sign a contract confirming that they're selling it to you. Usually, your conveyancers will actually exchange the contracts. This is also when you pay the deposit on the purchase.

After this point, you have entered into a legal agreement to buy the property. Following this, the next stage would be completion, where the balance of the purchase price is transferred to the seller and your mortgage loan becomes active.

Yes, a mortgage offer can be revoked after the step of contract exchange. However, it's rare to have a mortgage offer withdrawn this late into the process. By this point, you'll have presented your proof of income and other information to the lender and the lender will have checked your credit history, background and other factors. This means that the lender should, by now, know you meet their lending criteria. Still, it's possible for a mortgage to get declined at this point for a variety of reasons.

It's relatively rare to have a mortgage offer declined after exchange. By this stage, most details will have been worked out and the lender should have done sufficient checks to make sure that you meet their criteria and are eligible for the mortgage. The seller will also want to make sure that they can continue with the sale, so it's likely they'll have done what they can to ensure there are no problems with their paperwork, or anything else at their end.

While it's unlikely that you'll have your mortgage offer revoked at this point, you should make sure you know what to do in case it does happen, so you know what your options are.

It's important to know what your next steps are if you have a mortgage offer declined after exchange. Our top tips for dealing with a declined mortgage include the following.

• Find out what is wrong - if you want to make sure your next application is likely to get approved, you should make sure you know what the problem is. If the mortgage lender doesn't tell you what caused the rejection, you should get in touch with them and ask for an explanation. This will help you decide what to do next. If it's a minor error in the paperwork, you might be able to get this resolved without having to start a whole new application. If, however, it's because a major credit issue has come to light, you might need to apply again with a different lender that specialises in adverse credit
• Get expert advice - having your mortgage declined this late into the process is unlikely but can be extremely stressful. One of the best ways to deal with this is to get expert advice from an experienced mortgage broker like John Charcol. We’ll be able to help explain your options if you have been declined after the exchange and guide you through your next steps so you stand a better chance of securing a mortgage in the future. It’s in your best interest to secure advice before simply reapplying with another lender

Mortgage brokers generally have a great deal of experience with unusual cases, so we can help you if you find out that your mortgage has been declined towards the end of the process. One of our advisers will be able to help you understand what happened and guide you through what to do next.

If the issue is relatively minor, a broker might be able to assist by disputing the offer withdrawal in the hopes of getting your house-buying process back on track with as little disruption as possible.

If the problem is more significant, a mortgage broker will be able to give you advice on how to boost your chances of getting a mortgage with your next application. This can include telling you what went wrong before, what to avoid in the future, what steps you can take to improve affordability, as well as helping you find the right lender.

Finding the right lender for your circumstances is important. A lot of high street lenders often have very rigid lending criteria and they can reject borrowers who do not fit these criteria. However, there are many specialist lenders that will have more flexible criteria. For example, even if you get rejected by HSBC or another high street bank, a broker will probably be able to find a lender that is willing to offer you a mortgage.

Brokers also have access to a much wider range of lenders. This is because there are many lenders and private banks that will not deal with borrowers directly.

Having a mortgage declined at the last moment can be incredibly stressful and upsetting. Many buyers think that their mortgage offer is guaranteed at this stage, but in some rare cases, offers can be withdrawn.

If you want to know what to do if your mortgage gets declined after exchange, the best course of action is to contact a broker. An experienced mortgage broker will be able to help you get your mortgage moving forwards again.

Here at John Charcol, we have brokers with a huge range of experience helping people get their mortgages approved after setbacks like this. We can assist in a wide variety of circumstances, and we have access to a vast array of specialist lenders. Get in touch today to see how we can help.