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What if the mortgage application fails/is different?

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dhokes
dhokes Posts: 311 Forumite
First Post First Anniversary Combo Breaker
in House buying, renting & selling
I'm looking to purchase my first home and calculating the numbers.

Currently, I'm assuming I'll receive the amount that was stated in my mortgage in principle. I had this done a few months ago and I'm planning to get another one so say I use that figure from my new application.

1. Is it normal to make an offer for a house, assuming I'll receiving a mortgage for that amount?

2. What happens if the offer is accepted but then the mortgage application fails?

3. What happens if the offer is accepted but then the mortgage application tells me I can borrow significantly less, and as a result I can't offer to purchase the house?

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  • G_M
    G_M Posts: 51,977 Forumite
    Name Dropper First Anniversary First Post Combo Breaker
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    dhokes wrote: »
    1. Is it normal to make an offer for a house, assuming I'll receiving a mortgage for that amount?
    Some people make offers on this basis, some work out for themselves what they feel they can afford and affor only that amount.

    2. What happens if the offer is accepted but then the mortgage application fails?
    You either find the money elsewhere, or pull out of the purchase.

    3. What happens if the offer is accepted but then the mortgage application tells me I can borrow significantly less, and as a result I can't offer to purchase the house?
    You either find the money elsewhere, reduce your offer, or pull out of the purchase.
  • dhokes
    dhokes Posts: 311 Forumite
    First Post First Anniversary Combo Breaker
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    G_M wrote: »
    You either find the money elsewhere, reduce your offer, or pull out of the purchase.

    If you pull out of the purchase, there's nothing lost financially as nothing's been signed, right? Apart from a hit on my credit record.
  • juniordoc
    juniordoc Posts: 366 Forumite
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    Are you planning on buying with a particularly small % deposit? Do you have any reasons to think the mortgage application might fail?
    You could always protect yourself by offering a few grand less than what you have been approved for in principle.
  • dhokes
    dhokes Posts: 311 Forumite
    First Post First Anniversary Combo Breaker
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    juniordoc wrote: »
    Are you planning on buying with a particularly small % deposit? Do you have any reasons to think the mortgage application might fail?
    You could always protect yourself by offering a few grand less than what you have been approved for in principle.

    With my current calculations, I'm looking at a mortgage between 80-85% LTV and no, not really to be honest.
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