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Can a mortgage be withdrawn after the contract exchange? 

Even though it will feel like you’re almost there after exchanging contracts with the seller of your new property, there is the rare chance that a lender could withdraw after the exchange has taken place. 

Why would they do that? 

The lender could reassess your finances at any time. Whilst this is a rarity, there is the odd occasion where something may have been missed the first time round.  

If the lender finds anything that looks suspicious, be it fraudulent paperwork or any falsified any information, your application will be withdrawn straightaway.  

It’s also possible for your offer to expire. If you don’t purchase your house until a few months after you got your mortgage offer, there is a chance that it will have expired and you will have to reapply. 

So, what happens if my offer is withdrawn? 

If your mortgage offer is withdrawn after contracts have been exchanged, then you need to find a new one as soon as possible.  

If you don’t, the sale will fall through, and you will also be at risk of losing the fees that you have already paid.  

Should you pull out after the contract exchange, you will also lose 5-10% of the asking price you usually pay to secure the deal.  

When you go for a new mortgage, your application approval will depend on why your offer was withdrawn in the first place. If it was due to fraudulent reasons or deceit, then it’s unlikely that you’ll be able to find a new lender.  

It’s important to remember that the chances of something like this happening are slim but it’s important to be aware of it.  

For advice on the mortgage application process, or if you have any other queries, speak to one of our expert advisers who will be able to help you with the next steps.