Can A Mortgage Offer Be Withdrawn?

Mariam Abu HusseinLegal Assessment Specialist @ Lawhive
Updated on 31st January 2024

Getting a mortgage offer from a lender might feel like a big win, but it’s not always smooth sailing. 

While it’s tempting to think everything is sorted. It’s important to know that getting a mortgage offer is not a done deal and the situation can change depending on the lender’s conditions.


This is because, lenders have the power to tweak the terms of your offer, which can affect your plans. For example, they might reduce the amount they’re willing to lend you or change the interest rate based on your financial situation or market shifts.

In this article, we’ll look at how lenders can change the court of your property purchase journey by withdrawing or changing an offer, including:

Can a mortgage offer be withdrawn at any time? 

A mortgage offer isn’t legally binding the the lender. Lenders can withdraw a mortgage offer, but there must be a valid reason for the withdrawal. This can happen at any time before, or even after, exchanging contracts. 

Usually, mortgage offers are only withdrawn if something major changes and it doesn’t often happen out of the blue. 

Why are mortgage offers withdrawn? 

Lenders usually include a list of reasons why they may decide to withdraw a mortgage offer. 

Common reasons include: 

  • The mortgage offer has expired; 

  • Defects or issues with the property have been identified;

  • The borrower has provided false or misleading information on their mortgage application;

  • The lender suspects suspicious activity; 

  • Additional credit checks flag financial changes; 

  • The borrower’s circumstances change in a way that might affect their income regularly. 

Can a mortgage offer be withdrawn after contracts have been exchanged? 

Yes, mortgage lenders can withdraw their offer even after you’ve exchanged contracts.

As you might imagine, the later in the process a mortgage offer is withdrawn, the more problematic it becomes. 

If the lender does pull out, it may ne be possible to recover costs, especially if you have broken some of the conditions of the initial offer. Therefore, you’ll likely have to pay for conveyancer fees, survey fees, and mortgage broker fees. 

Can a lender withdraw a mortgage offer on completion day?

Lenders withhold the right to withdraw mortgage offers right up to completion day. So, technically, they can withdraw on completion day.

That being said, this is quite rare and only really happens in very exceptional circumstances, generally because the lender has uncovered an error or found out something about the buyer. 

Can you claim compensation if a lender withdraws a mortgage offer?

Mortgage lenders often have very good reasons for withdrawing a mortgage order and include these reasons in their conditions. Therefore, if a lender withdraws a mortgage offer because you breached the contract, then it’s unlikely that you’ll be able to claim compensation and you’ll probably have to cover any outstanding costs linked to the purchase, too. 

There’s also a good chance you might lose your deposit as well. 

What should you do if a mortgage offer is withdrawn? 

First, you should find out why the offer was withdrawn by contacting the lender. 

Once you know the reason why the mortgage offer was withdrawn, you should speak to your mortgage broker. They can help you understand what you should do and facilitate negotiations and conversations between you and the mortgage lender. 

However, if nothing can be done to salvage the situation, you may have to start the process again and find a new lender who may be more accommodating to your circumstances. 

How long do mortgage offers last?

Usually, mortgage offers are valid for a certain time - normally between 3 to 6 months. If you don’t complete before the end of this period, the lender can withdraw the offer. 

A lender should be upfront about how long a mortgage offer is valid. If any delays do arise, some lenders might agree to extend the offer, however, it’s important to tell either the lender directly or your property solicitor so they have enough notice of any potential delays. 

Can a change of circumstances affect a mortgage offer? 

Changes to your circumstances can affect a mortgage offer, even resulting in the offer being withdrawn. Therefore, if any of the following changes come about, you should contact your mortgage broker or solicitor to discuss how to proceed with your application: 

  • Your credit score goes down;

  • You lose your job, lose income, or move from employment to self-employment;

  • You want to buy a different property instead;

  • You have been declared bankrupt;

  • You or another applicant have become seriously ill. 

Changes in circumstances don’t always lead to an offer being withdrawn. However, if the change is incompatible with the lender’s criteria, then it’s likely it will. In some cases, the offer might be adjusted to account for the change. 

Can you cancel a mortgage application? 

You can cancel a mortgage application, but you might lose fees already paid. Before doing so, it’s a good idea to discuss cancelling your application with your property solicitor and check your offer’s terms so you have a good understanding of costs and future options. 

Sometimes, withdrawing from a property chain late in the process can harm your future borrowing chances, as it suggests to lenders that you might be unreliable. For that reason, cancelling a mortgage application is not to be taken lightly.

What can you do to make sure your mortgage offer isn’t withdrawn? 

There are no surefire ways to prevent a lender from withdrawing a mortgage offer, but you can take steps to minimise the possibility. 

The most important thing is to be completely honest in your mortgage application from the outset. Lying will not do you any good. Nor, as you might imagine, will engaging in criminal or fraudulent activities (but we don’t have to tell you that)! 

Finally, hiring an efficient and communicative solicitor or conveyancing is a good idea to ensure timely completion. 

How can we help?

At Lawhive, our conveyancers are on hand to guide you through the process of buying a property and handle all the complex legal matters related to it on your behalf. For a free, no-obligated fixed-fee quote, contact our legal assessment team today.

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