Can I change my mortgage offer before completion?

cybergirl10

Hello

I've received my mortgage offer almost 2 months ago but after just checking the bank's website I've noticed that their interest rates and product fees have gone down.

Can I get my mortgage offer changed to a better deal before I complete? I don't have a completion date yet on my purchase (probably in the next three weeks, haven't even exchanged yet) but I have paid on application £195 towards my product fee (owing a further £1800).

Any help/advice appreciated!

kingstreet

cybergirl10 wrote: »

Hello

I've received my mortgage offer almost 2 months ago but after just checking the bank's website I've noticed that their interest rates and product fees have gone down.

Can I get my mortgage offer changed to a better deal before I complete? I don't have a completion date yet on my purchase (probably in the next three weeks, haven't even exchanged yet) but I have paid on application £195 towards my product fee (owing a further £1800).

Any help/advice appreciated!

Possibly. You may have to pay the balance product fee for the deal you're giving up and the product fee for the new deal too. Lenders don't like people changing mid-stream, it makes a mess of their lending allocations.

By the way, exactly how much are you borrowing to make a £2k arrangement fee worthwhile? :eek:

mustang1

Phone up and ask them. I got my offer at 3.35% - it went down to 3.18% but when the fees and lack of freebies on the reduced rate deal wasn't worth it. 2 weeks ago the rate went down to 2.98% and the benefits were the same. I had to pay £150 withdrawal fee but everything else stayed the same so it was completely worth it. It has taken them forever to issue a revised offer letter though - my poor broker has called them every day this week and today it was confirmed offer letter has been sent out.

A lot of hassle but my monthly payment is £55 less so absolutely worth it.

cybergirl10

Thanks for the replies. I'm borrowing 212k so payments will be £25 less per mth and I would save £1k on the fee if they play ball.

Daniel_gecko

You can apply for however many mortgages you like.
Remember all the mortgage offer is, is an offer from the lender to loan you the money you have asked for. Therefore when you get the offer as you have done, you can exchange because you have a lender who has definitely agreed to lend you the money which would be required to finish your part of the contract you agreed to by exchanging.

When completion comes - it's up to you which 'offer' from various lenders (if multiple lenders have agreed to lend to you) you decide to take up.

However you would lose the application and valuation fees you have already paid if you were to make a new mortgage application. For this reason people who exchange many many months before completing (often houses in the process of being built for example) usually pick mortgages with 0 fee and free valuation so that they don't have to pay twice.

kingstreet

Daniel_gecko wrote: »

You can apply for however many mortgages you like.
Remember all the mortgage offer is, is an offer from the lender to loan you the money you have asked for. Therefore when you get the offer as you have done, you can exchange because you have a lender who has definitely agreed to lend you the money which would be required to finish your part of the contract you agreed to by exchanging.

When completion comes - it's up to you which 'offer' from various lenders (if multiple lenders have agreed to lend to you) you decide to take up.

However you would lose the application and valuation fees you have already paid if you were to make a new mortgage application. For this reason people who exchange many many months before completing (often houses in the process of being built for example) usually pick mortgages with 0 fee and free valuation so that they don't have to pay twice.

She wants to change products with the same lender, not change lenders altogether. However, the same situation applies if she did. She'd lose whatever fees she had committed to pay and would have to pay all the fees for the new deal.

cybergirl10

According to my mortgage offer the balance of £1800 is payable on release of the funds. Seeing as I will be asking to change the product before any monies have been released, I'm hoping that I may not have to pay the rest. Thanks!

chalky2011

mustang1 wrote: »

Phone up and ask them. I got my offer at 3.35% - it went down to 3.18% but when the fees and lack of freebies on the reduced rate deal wasn't worth it. 2 weeks ago the rate went down to 2.98% and the benefits were the same. I had to pay £150 withdrawal fee but everything else stayed the same so it was completely worth it. It has taken them forever to issue a revised offer letter though - my poor broker has called them every day this week and today it was confirmed offer letter has been sent out.

A lot of hassle but my monthly payment is £55 less so absolutely worth it.

this sounds not bad mustang any details lender, term , rate etc?

mustang1

It's the Woolwich 2 year fix. Fee is £999 which is high but I'm borrowing £250K and worked out the best for me when I applied in April (at 3.35%).

It's dropped twice since I applied and I managed to get this in just before I complete - due to complete end of next week.

All in all, I'm dropping from my current 5.29% to 2.98%. Keeping monthly payments the same and cutting my term from 25 to 16 years.

Moral of story is to keep an eye on rates for a while before you complete but then stop looking otherwise you'll end up beating yourself up if you find a better deal somewhere else!

kriskross

This thread is old but I have some additional questions.

Would the solicitor charge a fee for changing interest rate if the lender stays the same:
The solicitors price list includes something this: "change of mortgage lender - each new offer, £95"

Let_Us_See

I hate to state the obvious, but simply phone ask. This must be easier than relying on other people's conjecture?