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Final Credit Check Before Completion

Do mortgage lenders perform a final credit check before completion? Find out in our guide

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No impact on credit score

Pete Mugleston

Author: Pete Mugleston - Mortgage Advisor, MD

Updated: September 16, 2021

After successfully gaining a mortgage in principle, the excitement that comes from potentially buying a home can soon turn to worry.

Many future homeowners notice that after applying for a mortgage, their credit score has been impacted and despite the fact that they are in the process of completion, the change in credit score can make some people nervous.

After all, what happens if a lender runs another credit check between exchange and completion? Could the change in credit score result in their mortgage falling through?

Buying a home can be stressful enough, so to ease your mind and answer questions you may have, we’ve created this handy guide.

Do lenders run a credit check before exchange?

Yes, lenders will run extensive mortgage credit checks to determine whether you can afford the mortgage you are applying for as well as the likelihood of you failing to make your mortgage payments.

These checks often include questions regarding your:

A key factor that lenders will also look at is your credit history. There are multiple credit reference agencies (CRAs) that lenders may use to establish your score and frustratingly, they can all give varying scores.

If your credit report shows a history of mismanaging money and accumulating debt before the mortgage, this can seriously impact your choice of lenders and your ability to obtain a mortgage.

However, if your lender completes these checks and is satisfied with your affordability as well as other factors, they may offer you a mortgage in principle.

The next step for you would be to find a property to purchase. If the current owner or housebuilder agrees to sell it to you, there should be an exchange in contracts.

This period of time can be nerve-wracking for buyers and that’s why many come to us with fears about additional credit checks before an exchange of contracts.

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Do lenders run a credit check after an exchange?

At this point of exchanging the contract, the property purchase is made legally binding between both parties. Many people are unaware that even at this point the sale can fall through, usually because the seller has backed out or the lender has withdrawn the mortgage offer.

In fact, a mortgage lender can decline a mortgage application after the exchange of contracts and all the way up until completion.

Why? This could, unfortunately, be because of a multitude of reasons, one being that they have ran a secondary credit check after the exchange, which has given the lenders reason to feel less confident about your affordability.

What factors could affect a credit check between exchange and completion?

For the vast majority of mortgage applications, a credit check at this stage of the process is purely to ensure there have been no significant changes before final completion.

The good news is that when a lender decides to re-run a credit check just before completion, it is normally to check the status of employment. If this hasn’t changed, a slight change of credit score because of a mortgage application shouldn’t affect your changes of proceeding.

Some people also worry that a second credit check will further impact their score but thankfully, multiple credit checks with the same lender will not affect your credit score.

The daunting prospect of the sale falling through can be stressful, but with the help of a mortgage advisor, the process can be made straightforward and simple.

Will there be a final mortgage credit check before completion?

Potentially yes, as sometimes lenders may have reason to further check your affordability.

Usually, this is done in the event that something substantial changes on your mortgage application which could affect your ability to keep up with payments.

This could be:

In the event that any of the above drastically change ahead of completion, you should inform your mortgage broker who can advise you on how best to broach the topic with your lender.

It may be the case that a change in your circumstances doesn’t negatively impact your mortgage application but in some situations, it may delay the process or result in the sale falling through.

This can be troubling as a buyer but even if this were to happen, it doesn’t necessarily mean that you won’t be able to successfully purchase a home.

How can a mortgage advisor help me?

Buying a home, whether it be for the first time or applying for a second mortgage can be daunting.

The advice of a professional who has negotiated mortgage contracts and overseen the application process many times can be really helpful.

A mortgage broker can:

  • Oversee the exchange of contracts and give guidance for how to avoid delays or withdrawals
  • Advise you about how to keep your credit score intact ahead of final credit checks before completion
  • Find alternative lenders who are more likely to accept your application if final credit checks after an exchange result in a mortgage rejection

Speak to a mortgage expert today

If you still have concerns about credit checks between exchange and completion, ask a broker. The advisors we work with have years of experience and can help you understand the mortgage process from application to completion.

Their job is to find you the best mortgage deal based on your circumstances but more importantly, their priority is making sure you successfully complete and reach a positive outcome.

In short, they can save you time, money and potential disappointment.

Speak to one of the experts today by calling us on 0808 189 2301, or make an enquiry with us.

Ask a quick question

We know everyone's circumstances are different, that's why we work with mortgage brokers who are experts in all different mortgage subjects.

Ask us a question and we'll get the best expert to help.

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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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