Can a mortgage lender withdraw their offer before completion/after ex of contracts?

snowcat123

Hi,

My partner and I have had a formal offer from the Halifax for a new build which we have accepted.

We visited the solicitors and signed all the mortgage documents, contracts with the house builder etc of which we were told had officially exchanged last Friday. :j

My wife wants to buy some new sofas on an interest free credit (at DFS!!!!) but I've told her it's best not to apply for credit until we complete (1st May).

Am I right in thinking that a lender can withdraw their mortgage offer even after the exchange if more credit has been sought after (even if it is just for a sofa)?

betmunch

The lender can withdraw their offer at any time before completion. DO NOT GET ANY CREDIT until you have drawn down the mortgage, this means completion of the purchase

kingstreet

Exchange of contracts does not matter to a lender. It can withdraw an offer at any time without explanation.

You're right. No new credit applications until after completion.

snowcat123

Thanks. Will ensure that we don't take any credit out.

How likely is it for a mortgage lender to withdraw their offer? Under what circumstances do they normally do this?

GMS

Offer withdrawal would usually be if further information came to light such as an audit being done on the file and information not being substantiated or found to be untrue.

If your application was correct and all information contained within it can be proven upon request then you should have no issues.

kingstreet

Some lenders carry out random audits on cases and I suspect this is triggered by the solicitor forwarding the report on title to request the completion funds. I recently saw a suggestion that Halifax, for example, samples around 8.5% of its cases in this way.

Any information which comes to light which would put doubt in the mind of the underwriter could cause an offer to be withdrawn. Applications for credit post-application are therefore to be avoided. If your application data is backed up by the documentation requested, you should be fine.

Dave_Ham

Hi there,

In my experience not many clients tend to worry about this being an issue - see previous post regarding upfront and honest information provided.

Is there something you are worried about, or specifically something that has happended post offer.

We would be able to give you a better idea.

Again unproven information, but apparently certain solicitors when used and more likely to have the full offer audited... Especially if transferred to post application..

snowcat123

Hi - thanks for the replies they are very much appreciated.

It's a straightforward application and my wife and I have nothing to hide! We submitted everything honestly and provided all the documentation we were asked for.

We will ensure that we get no further credit!

Thanks guys - just a worried FTB here