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How a Change of Circumstances Can Affect Your Mortgage Offer

Discover what you can do in the event of an unexpected change of circumstances after a mortgage offer.

No impact on credit score

Pete Mugleston

Author: Pete Mugleston - Mortgage Advisor, MD

Updated: August 10, 2021

As you go through the process of buying a home, each step takes you closer to completing the deal and picking up the keys. But, if you’ve accepted a mortgage offer from your lender and have had an unexpected change of circumstances, that final step of completion may suddenly feel like a long way away.

Unfortunately, this can happen more often than you might expect. The best way to move forward if your circumstances change after you’ve had a mortgage offer and are ready to exchange is to speak with a qualified and experienced mortgage advisor.

What happens to my mortgage when there’s a change of circumstance?

If you have accepted a mortgage offer and there’s an unexpected change in your circumstances, you may be wondering what your next steps should be.

Although you might be confident that things will work out, and you’ll be able to afford the mortgage you’ve committed to, if the change in circumstances is material or notable, then you must let your lender and solicitor know.

Even if you don’t let you solicitor or lender know that something has changed, if it involves your finances, it’s possible that any final checks they do before releasing the funds will be picked up. That could work out badly for you and in the worst-case scenario, result in them withdrawing your offer. They also may possibly make further notes on your application, which can be taken into account for any future financial applications with the lender.

If you fail to advise of your change in circumstances and the mortgage completes, should it subsequently come to the lenders attention they would be within their rights to seek to repossess your property should they deem the mortgage not affordable or suitable for you.

If they review your change of circumstances and no longer happy to stick with their previous offer, you can either:

  • Accept their new offer, if they make one
  • Look for a new mortgage offer based on your newly changed circumstances, though bear in mind that you would need to disclose to your new lender what happened with the old one

A mortgage advisor will have experience in helping those affected by a change in circumstances. They’ll be able to advise what steps you need to take next, and can source other lenders who may be able to offer you a better deal.

What are the rules around mortgage offers and a material change of circumstance?

The terms and conditions for each mortgage lender will differ, so when it comes to what constitutes a change of circumstances, you will need to consult any paperwork you have for your lender’s specific rules.

However, if something changes in your life unexpectedly (such as being made redundant, you can find more about redundancies and mortgages in our guide.) and it could have a potentially negative effect on your finances and make your mortgage less affordable, your mortgage lender will need to know in order to find a solution.

Do I have to report my change of circumstances in relation to my mortgage offer?

If the change in your circumstances affects your ability to repay the mortgage in any way shape or form then yes, you must report it to the lender.

For example, if you’ve had to reduce your hours at work for any reason then your income would be affected, this may mean that your mortgage is now no longer affordable.

Alternatively, if you’re getting a pay rise this would only make your mortgage even easier to support so you probably wouldn’t need to advise the lender.

If you’re unsure, speak with one of our expert advisors who will be able to offer you the best advice. They can also help you find an alternative mortgage if the offer you’ve accepted is withdrawn due to your change in circumstances.

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Can I still get a mortgage even though my circumstances have changed?

The nature of how your circumstances changed will affect your lender’s view of your mortgage offer after your application, though it depends on what the change is and exactly how it affects your ability to pay a mortgage.

Even if one lender withdraws a mortgage offer, you could still secure a mortgage, despite your change of circumstances.

Will my change of circumstance and potential mortgage offer withdrawal affect my credit rating?

If your circumstances have changed, it won’t affect your credit score, unless it results in you missing debt payments.

However, if a lender initially approved a mortgage but then withdrew it after a change of circumstances, this would likely be on your credit file. That’s because all credit and mortgage applications are on your credit file, including whether they were approved or declined for a mortgage.

One of the best options to avoid this would be to speak with an experienced mortgage advisor, like those we work with. They can help you understand your mortgage affordability from a lender’s perspective after you’ve experienced a material change in circumstances.

A mortgage broker will also be able to help you apply for a new mortgage with a lender who will likely be happy with your application, despite your changed circumstances.

Speak with an expert mortgage advisor about your mortgage offer and change of circumstances

If you have a mortgage offer for a home you want to buy, but experience an unexpected change in circumstances don’t worry. Call us on 0808 189 2301 or make an enquiry. We don’t charge and fees and the advice you receive from an expert is impartial.

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About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for OMA of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

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FCA disclaimer

*Based on our research, the content contained in this article is accurate as of the most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs.

Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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