Receiving your formal mortgage offer can feel like the final hurdle in getting a mortgage. The lender has assessed your application, considered the property and confirmed the mortgage it is prepared to offer you. But what happens if circumstances change before you complete?
Perhaps mortgage rates fall and a cheaper deal becomes available. Maybe your lender launches a new product. Your purchase price could change, or you might start wondering whether another lender now offers a better mortgage.
So, are you stuck with the mortgage you’ve already been offered?
Not necessarily. In some circumstances, it may be possible to change your mortgage product or even move to another lender after receiving a mortgage offer. However, changing the mortgage can involve additional checks, delays and potentially a new application, so the overall benefit needs to be considered carefully.
Quick Answer: Can I Change My Mortgage After Receiving an Offer?
Yes, potentially. Receiving a formal mortgage offer doesn’t always mean you’re permanently committed to that exact mortgage product until completion.
Depending on the lender and what you want to change, you may be able to:
- switch to a different product with the same lender;
- move onto a lower rate if your lender has repriced;
- change the mortgage amount;
- amend certain application details; or
- apply to a different mortgage lender.
Changing product with your existing lender is usually a very different process from changing lender altogether. Moving to another lender will normally mean making a new mortgage application and going through affordability checks, underwriting and potentially another property valuation.
If mortgage rates have fallen since your offer was issued, speak to your mortgage adviser before cancelling or changing anything.
What Is a Formal Mortgage Offer?
A formal mortgage offer is confirmation that a lender is prepared to provide your mortgage, subject to the conditions within the offer.
It is different from a Mortgage in Principle (MIP) or Agreement in Principle (AIP), which is only an initial indication of potential borrowing.
A formal offer is issued much later, after the lender has assessed your application and the property. However, it will normally have conditions and an expiry date, and changes before completion can sometimes require the lender to reassess the application.
Can I Change to a Lower Mortgage Rate Before Completion?
Potentially. This is probably the question most borrowers are interested in. Imagine you apply for a mortgage and receive an offer at 5.20%. Several weeks later, before your purchase completes, your lender launches a similar mortgage product at 4.90%.
Understandably, you probably won’t want to complete at 5.20% without at least investigating whether the lower rate is available to you.
Some lenders may allow an existing application to be moved onto a newer product before completion, subject to their process and eligibility requirements. Others may have restrictions around when or how a product can be changed.
This is one reason why receiving the mortgage offer shouldn’t necessarily be the end of the advice process. If rates fall before completion, your mortgage adviser can check whether your lender has introduced a better product and whether changing it would genuinely benefit you.
What Difference Could a Lower Rate Make?
Whether changing product is worthwhile depends partly on the size of the mortgage.
For example, imagine you are borrowing:
Mortgage: £500,000
Term: 30 years
Original rate: 5.20%
Potential new rate: 4.90%
On a £500,000 repayment mortgage over 30 years, reducing the interest rate from 5.20% to 4.90% would reduce the initial monthly repayment by approximately £90, before considering fees or other costs.
Over two years, that could represent more than £2,000 of difference in monthly payments, although the actual financial benefit would depend on fees, the changing mortgage balance and the terms of each product.
This is only an illustration rather than a mortgage quotation, but it demonstrates why checking a lower rate can be worthwhile on a larger mortgage.
A seemingly small movement in interest rates can make a meaningful difference when the loan itself is substantial.
Does My Lender Have to Give Me Its New Lower Rate?
No. A lender reducing its mortgage rates doesn’t automatically mean every borrower with an existing mortgage offer will be moved onto the cheaper product.
The new product might have:
- different LTV requirements
- different fees
- different eligibility criteria
- a different fixed period
- different incentives
- different application rules.
You therefore need to establish whether the new product is actually available to your application.
This is also why seeing a lower headline rate online doesn’t necessarily mean you can switch your existing mortgage offer onto that product.
Can I Change Mortgage Lender After Receiving an Offer?
Potentially, yes. However, changing lender is usually much more involved than switching to another product with your existing lender.
The new lender will normally need to assess the mortgage independently. This could involve:
- a new mortgage application;
- another affordability assessment and credit check;
- supporting documents;
- a new assessment of the property; and
- potentially another valuation.
You would then need to wait for the new lender to issue its own formal mortgage offer.
This introduces both time and risk.
If you’re several months away from completion, there may be enough time to consider another lender. If you’re close to exchange or completion, starting again purely to obtain a slightly lower rate could potentially put the transaction at risk.
Don’t cancel your existing mortgage offer until you understand whether the alternative mortgage is achievable and what changing lender would involve.
Is a Lower Mortgage Rate Always Better?
No. A lower interest rate doesn’t automatically mean a mortgage will cost you less overall.
When comparing your existing offer with an alternative, consider:
- product fees;
- valuation or legal costs;
- cashback and other incentives;
- monthly repayments;
- total cost over the initial deal period;
- whether you meet the new lender’s affordability and property criteria; and
- whether changing could delay the transaction.
A slightly lower rate with a substantially higher product fee may not produce a meaningful saving, particularly on a smaller mortgage.
The comparison should therefore be based on the overall cost and practical implications of changing, rather than the headline interest rate alone.
What If Mortgage Rates Go Up After I Receive My Offer?
If you’ve already secured a fixed-rate mortgage and market rates subsequently rise, you may still be able to proceed on the rate contained within your existing offer, provided the offer remains valid and its conditions continue to be met.
This is one reason securing a suitable mortgage doesn’t necessarily mean you should delay an application because you think rates might fall.
If rates fall before completion, it may be possible to investigate a better product. If rates rise, an existing fixed-rate offer may protect you from that increase.
Can a Mortgage Offer Be Withdrawn?
Yes, in some circumstances.
A formal mortgage offer is an important milestone, but borrowers should not assume that nothing can affect it before completion.
For example, a lender may need to reconsider the mortgage if there are:
- significant changes to your income or employment;
- substantial new borrowing;
- inaccuracies discovered in the information supplied;
- changes affecting the property; or
- conditions of the mortgage offer that haven’t been satisfied.
This is why taking out substantial new credit between mortgage offer and completion can be risky.
If something significant changes, speak to your mortgage adviser rather than assuming it doesn’t matter because the mortgage has already been offered.
Can I Change the Mortgage Amount After Receiving an Offer?
Potentially, although the lender may need to reassess the application.
For example, if you renegotiate the purchase price following a survey but still want to borrow the same mortgage amount, your loan-to-value (LTV) will increase.
A £500,000 mortgage against a £600,000 property represents approximately 83% LTV. If the purchase price falls to £580,000 but the mortgage remains £500,000, the LTV increases to approximately 86%.
That could matter if your existing mortgage product is only available up to 85% LTV.
Changes to the purchase price, deposit or mortgage amount can therefore affect the mortgage products available to you.
Tell your mortgage adviser and solicitor about any agreed change to the purchase price so that the mortgage can be amended correctly.
Can I Change From a Two-Year to a Five-Year Fixed Mortgage?
Potentially, if your lender allows you to change product before completion and you’re eligible for the alternative mortgage.
For example, you may decide that a five-year fixed rate now suits you better than the two-year fix you originally selected.
However, the decision shouldn’t be based on interest rate alone. Consider the length of time you expect to keep the mortgage, early repayment charges, portability and the flexibility you may need in future.
Read our guide to 2-year vs 5-year fixed mortgages for a more detailed comparison.
Can I Change My Mortgage After Exchange of Contracts?
This is where considerably more caution is needed.
In England and Wales, exchange of contracts makes the property transaction legally binding. MoneyHelper advises buyers to ensure they have their written mortgage offer before exchanging.
Changing lender after exchange could therefore introduce significant risk if the replacement mortgage isn’t ready in time for the agreed completion date.
There may be situations where a change is necessary, but this isn’t something we’d recommend doing casually simply because you’ve spotted a marginally cheaper mortgage online.
Speak to your solicitor and mortgage adviser before making any change that could affect funding for completion.
What If My Mortgage Offer Is About to Expire?
Mortgage offers don’t last indefinitely, and the validity period varies between lenders and products.
If completion is delayed, it may sometimes be possible to request an extension. However, this isn’t necessarily automatic and the lender could require updated information or reassess parts of the application.
This can be particularly important for new-build purchases or transactions involving a long chain.
If your completion date is likely to fall close to or after the mortgage offer expiry date, speak to your adviser well in advance rather than waiting until the final few days.
What Should I Do If I See a Better Mortgage Before Completion?
Don’t immediately cancel your existing mortgage offer.
Instead:
- Speak to your mortgage adviser and establish whether the new deal is genuinely available to you.
- Check your existing lender first to see whether you can switch product without changing lender.
- Compare the total cost, including rates, fees and incentives.
- Calculate the actual saving over the period you’re comparing.
- Consider the timing, particularly how close you are to exchange and completion.
- Understand what changing involves, including any new underwriting, credit checks or valuation.
Your existing mortgage offer has value because you already have it.
Don’t give it up until you understand whether the alternative is both better and achievable.
Oportfolio Insight
Receiving a mortgage offer shouldn’t necessarily be the end of the advice process.
We continue to monitor our clients’ mortgages through to completion because the market can change during the weeks or months between application and receiving the keys.
If the lender reduces its rates, we’ll establish whether the existing application can be moved onto a better product and whether doing so genuinely benefits the client.
But the rate isn’t the only consideration.
Saving £20 a month may not justify disrupting a purchase that’s due to complete next week. A meaningful rate reduction on a £750,000 mortgage with several months until completion could be a very different situation.
That’s why we look at the actual saving, fees, lender criteria and transaction timescale rather than simply switching because another mortgage has a lower headline rate.
This is one of the benefits of having an adviser continue to manage your mortgage after the offer has been issued.
Already Have a Mortgage Offer and Seen a Better Rate?
If you’ve already secured a mortgage but rates have fallen since you applied, it may be worth checking whether a better option is available before you complete.
At Oportfolio Mortgages, we can review your existing mortgage alongside any alternative options and compare the interest rate, fees, monthly payments, overall cost, lender criteria and the time remaining before completion.
In some cases, your existing lender may allow you to move onto a cheaper product without starting the entire mortgage application again.
In others, changing lender may be possible but the potential saving should be weighed against the additional time, cost and risk involved.
