Mortgage Declined After Exchange, When an Offer Is Withdrawn

What is a mortgage declined after exchange?

A mortgage declined after exchange is a lender's withdrawal of its mortgage offer, or its refusal to release the funds, after the buyer has exchanged contracts and become legally bound to complete the purchase on a fixed date. Exchange of contracts is the point in England and Wales where the agreement to buy becomes binding. Before exchange, an offer on a home is not legally binding. After it, GOV.UK's buying guide says that usually neither side can pull out without paying compensation (GOV.UK: buying a home, transferring ownership). The contract with the seller does not depend on the mortgage, so a mortgage offer withdrawn after exchange leaves the buyer liable to pay the full price on the completion date, whether or not the lender's money arrives. Some buyers call this a mortgage pulled after exchange; whatever it is called, the legal position is the same.

The Financial Conduct Authority's rules in its MCOB sourcebook require a lender offering an MCD regulated mortgage contract, the kind of regulated mortgage normally used to buy a home, to set out a binding offer in an offer document, so that offer binds the lender once it is made. The same rules allow the offer to carry lawful conditions. FCA guidance says these can cover a material change in the facts after the offer is made: a change in the borrower's circumstances that is likely to affect affordability, such as loss of employment or further secured borrowing, or a change affecting the condition, value or title of the property. They can also cover the borrower knowingly giving incomplete or inaccurate information. A lender cannot use the conditions to avoid assessing affordability properly before it makes the offer (FCA Handbook: MCOB 6A.3.1R and 6A.3.3G). If one of them applies, the offer can still be withdrawn between exchange and completion. Some lenders also refresh the credit file or reconfirm employment shortly before they release the funds, so a change can come to light at that point.

A mortgage on a home is a regulated mortgage contract where the borrower is an individual and at least 40% of the property is used, or intended to be used, as a dwelling (legislation.gov.uk: Regulated Activities Order, article 61). The lender then assesses it under the FCA's MCOB rules (FCA Handbook: MCOB 11.6). A bridging loan used to complete the purchase of such a home is a regulated bridging loan, which has its own rules, set out with the bridging route below.

Mortgage Lane helps buyers who have exchanged and whose mortgage offer has been withdrawn or whose completion is at risk. The causes include redundancy or a change in income, an offer expiring before a delayed new build completion, valuation or title issues, and something a lender finds in its final checks. We work with your conveyancer so that the purchase can complete within the contract's timetable. Before exchange the buyer is not yet bound and can still pull out, so a lender's withdrawal at that stage is a different position: our guide to a mortgage declined before completion covers it, and our declined mortgages page covers refusals at every stage.

Scotland and Northern Ireland

Scotland has no exchange of contracts. The buyer's and seller's solicitors exchange letters called missives, and once the concluding missive is sent they form a binding contract (mygov.scot: missives). The price is paid at settlement on the date of entry. Where the missives incorporate the Scottish Standard Clauses (Edition 6), the all-Scotland style published by the Scottish Conveyancers Forum, late payment lets the seller claim either its reasonable losses or interest on the unpaid price at 4% above a named bank's base rate. If the price is still unpaid more than 14 days after it was due, the seller can rescind the missives and then claim either its losses, including any loss on a resale, or a sum worked out as interest on the unpaid price for up to 12 months (Law Society of Scotland: Scottish Standard Clauses (Edition 6), clause 13). Missives on other terms can say something different, and the buyer's solicitor explains the terms that apply. Our mortgages in Scotland page covers the Scottish buying process.

In Northern Ireland the sale also becomes legally binding at the exchange of contracts, and nidirect says a deposit of at least 5% of the price is usual (nidirect: buying a home step by step). Northern Ireland has its own General Conditions of Sale, published by the Law Society of Northern Ireland (Judiciary NI: Bones v Robinson [2011] NICh 26). After a missed completion there, the notice period and the seller's remedies are the ones in the Northern Ireland contract, not the Standard Conditions described below, and a solicitor in Northern Ireland can explain them. Our mortgages in Northern Ireland page covers buying there.

Mortgage rates when completing at short notice

A withdrawn offer has no rate of its own, and the cost depends on the route that completes the purchase. A replacement mortgage is priced as an ordinary residential mortgage, by the lender, the loan to value band and the credit file, so a lender that can move quickly may still offer its standard products. Where no term lender can underwrite in time, a bridging loan completes the purchase and a term mortgage follows. Bridging is priced monthly rather than annually. Its interest is often rolled up into the loan or deducted at the start, so the cost grows with each month the bridge stays in place. Lender, valuation and legal fees apply to both routes, and Mortgage Lane does not quote rates on this page.

The cost of either route can be set against what is at stake under the contract: the deposit paid at exchange, compensation at the contract rate for each day completion is late, and any claim the seller makes for its losses. The worked example further down this page puts those figures side by side, and the calculator lets you enter your own. Each route also has to be available in the time left, which can matter more than its price.

Offer withdrawn after exchange? Get in touch with the completion date, the lender's letter and your circumstances, and tell your conveyancer the same day. The contract's timetable keeps running while the options are checked.

What we need when an offer is withdrawn after exchange

Which routes stay open depends on the first days after a withdrawal, so we start with the documents that show the deadline, the lender's reason and your finances. The completion date and the contract terms set the timetable. The lender's letter shows whether its reason can be resolved, and your income, credit reports and assets show what a replacement lender or a bridging lender will need. Your conveyancer holds the contract and deals with the seller's solicitor, so anything that affects the seller goes through them. The table lists what we ask for and why; lenders work at different speeds.

Why a mortgage offer can be withdrawn after exchange, and how each case is handled

Withdrawals after exchange have five kinds of cause, and each points to a different way of completing.

Job loss or a change in income

Redundancy, a new job still in its probation period, reduced hours or a move from employment to self-employment can lead a lender to withdraw where the offer's conditions require you to report a material change. The FCA's guidance names loss of employment as one of the changes a binding offer's conditions can cover. Some lenders reconfirm employment shortly before completion, so a change can come to light even if you did not report it. A replacement lender looks at the income you have now, and lenders differ on new jobs: some accept a new permanent role from the start, while others want time in the role first. A move to self-employment narrows the choice further, because a lender assessing self-employed income usually wants to see a trading history. Our pages on fixed term contract mortgages and self-employed mortgages explain how lenders read those incomes.

Get in touch with your new employment contract or redundancy letter and your latest payslips.

New debt or credit problems

Taking on new credit after the offer, missing payments or receiving a county court judgment can lead to a withdrawal if the lender rechecks your credit before completion. Further secured borrowing is the other example the FCA's guidance gives of a change an offer's conditions can cover. A replacement lender sees the same file. In our experience, lending to borrowers with adverse credit usually goes to 90% loan to value at most, so a recent missed payment or judgment can mean a bigger deposit as well as a narrower choice of lender. Our pages on mortgages with missed payments, CCJ mortgages and low credit score mortgages explain how lenders read each entry.

Get in touch with your updated credit reports from the main credit reference agencies.

Information found to be inaccurate

If the lender finds that your income, the source of your deposit or other details were wrong, it can withdraw: the FCA's guidance allows a binding offer to be conditional on the borrower not knowingly giving incomplete or inaccurate information. Any replacement lender sees the same facts, so the new application has to be accurate from the start, including the change that led to the withdrawal. Questions about where the deposit came from also go to the conveyancer, who carries out anti-money laundering checks before the money can be used. If a replacement application is refused in turn, our page on a mortgage declined after application covers what to check before applying again.

Get in touch to go through the facts accurately before any new application.

Property or title problems

A defect in the title, a problem with the lease, works carried out without the consents they needed, a building safety concern or a late valuation concern can lead the lender to withdraw or to refuse to release the funds. The FCA's guidance names a change affecting the condition, value or title of the property as a ground an offer's conditions can cover. Because the problem is with the property, a replacement lender has to accept the property as it is, or the problem has to be put right before completion. A short or onerous lease is covered on our mortgage for a leasehold flat page, and a valuation that comes in low on our page on a mortgage declined on valuation.

Get in touch with your conveyancer's report on title and the lender's valuation.

Offer expiry before completion

A mortgage offer is valid for a set period, which each lender decides. On a new build bought before it is finished, contracts can be exchanged months before the home is ready, and if the build runs late the offer can expire after exchange. The lender may extend it, sometimes after fresh checks of your income, credit or the valuation, or a new application may be needed before the home is finished. An offer can also fall through before completion where one of its special conditions, such as a document the lender asked for or the insurance it requires, has not been met. Our guides to new build mortgages and to a mortgage on a new build bought off plan cover the timing.

Get in touch with the offer's expiry date and the developer's latest completion estimate.

What happens if you cannot complete: notice to complete, your deposit and the seller's claim

In England and Wales, under the Standard Conditions of Sale, a buyer who does not complete on the agreed date can be served with a notice to complete, which gives ten working days. The Law Society publishes the Standard Conditions of Sale (Fifth Edition, 2018 Revision) for residential sales. A contract that incorporates them can change any of them by special conditions, so the contract itself is the document to read (Law Society: Standard Conditions of Sale). The rules below are the conditions as published, and they are the starting point if you cannot complete.

The notice to complete

Under the conditions, the time for completion on the completion date is 2pm. Once it has passed, a party who is ready, able and willing to complete can serve a notice to complete. The parties then have to complete within ten working days, not counting the day the notice is given, and time becomes of the essence, which makes the deadline strict. A working day is Monday to Friday other than Christmas Day, Good Friday and bank holidays, so ten working days is usually two calendar weeks, and longer if a bank holiday falls within them. A notice received after 4pm, or on a day that is not a working day, counts as received on the next working day. If the buyer paid a deposit of less than 10%, the conditions require the balance up to 10% to be paid as soon as the notice arrives.

Compensation for late completion

A buyer who causes completion to be late pays the seller compensation at the contract rate on the price less the deposit paid, for each day of delay. The contract rate is the one written into the contract. If the contract adopts the Standard Conditions without changing that rate, it is the Law Society's interest rate, which has been 7.75% since 18 December 2025 and was still the current rate in October 2026 (Law Society: interest rate). On a £300,000 purchase with a £30,000 deposit, that is £57.33 a day. For compensation, money that reaches the seller after 2pm is treated as arriving on the next working day. Any later claim the seller makes for losses caused by the delay is reduced by the compensation already paid.

Rescission, the deposit and the seller's claim

If the buyer still has not completed when the notice runs out, the seller can rescind the contract. The Standard Conditions then let the seller forfeit and keep the deposit with any interest earned on it, resell the property and claim damages, which can include a lower resale price and the costs of reselling. The conditions set the deposit at 10% of the price unless the contract says otherwise. A court can, if it thinks fit, order a deposit to be repaid (legislation.gov.uk: Law of Property Act 1925, section 49), and a solicitor can say whether it might. The seller's own onward purchase may depend on this one, which can leave the seller little room to wait.

Mortgage Lane does not give legal advice. Your conveyancer or a solicitor can say what your contract allows, whether a notice has been validly served and what a claim against you could include.

How to complete after a mortgage offer is withdrawn

Five routes can still get a purchase to completion after a mortgage offer is withdrawn, and the time left on the contract decides which of them are realistic. Often more than one is prepared at the same time, while your conveyancer keeps the seller's solicitor informed.

Resolving it with the same lender

An offer can be withdrawn only under its conditions, so the first step is to read the lender's letter against them. Some withdrawals rest on missing information, a document the lender could not verify or a fixable issue with the property, and the lender may reinstate the offer once that is dealt with. Where the reason is a misunderstanding about your income or your credit, evidence may resolve it faster than a new application elsewhere.

A replacement lender

A replacement lender assesses your circumstances as they are now, and it has to underwrite and complete within the timetable. Speed varies by lender. Some can issue an offer quickly where documents are ready and the valuation can be done at once, while others take weeks. Some lenders accept a transcribed valuation or use a desktop valuation. Buyers sometimes look for an emergency mortgage after exchange, but there is no separate product: the replacement is an ordinary residential mortgage, chosen for its speed and its fit with the reason for the withdrawal. Our pages on a mortgage declined at underwriting and a mortgage declined on affordability explain how underwriters test the case and the income.

A bridging loan to complete

A bridging loan to complete the purchase pays the seller while a term mortgage is arranged to repay it. It is secured on the property being bought, and sometimes on another property as well. A bridging loan on a home you will live in is a regulated bridging loan, which the FCA defines as a regulated mortgage contract with a term of 12 months or less (FCA Handbook glossary: bridging loan). A bridge repaid in one sum at the end of its term is an interest-only mortgage under the FCA's rules, so before lending the lender must have evidence of a clearly understood and credible repayment strategy. Where the plan is to repay the bridge with a mainstream mortgage, the FCA's guidance says the lender should not accept that plan unless it is reasonably satisfied that a mainstream lender will lend. An agreement in principle, or your income and spending, can show this. If a lender accepts an expected improvement in your credit as the exit without evidence of a firm offer of the longer-term loan, the FCA treats that as tending to show a breach of the rule (FCA Handbook: MCOB 11.6.41R, 11.6.53E and 11.6.54G). The exit is usually a remortgage onto a term mortgage once your new income can be evidenced.

A bridge to complete the purchase of a property bought to let as an investment is usually an investment property loan, outside these rules (legislation.gov.uk: Regulated Activities Order, article 61A). Bridging can complete faster than a term mortgage, and our guide on how quickly a bridging loan completes sets out what speeds it up. The bridge and its exit are covered on our bridging loans page, in our guide to regulated bridging loans for homeowners and on our page on remortgaging after a bridging loan.

Negotiating a delay

The seller may agree to move the completion date, often in return for compensation, but does not have to. A request goes through the conveyancers, and it is easier to agree before a notice to complete is served, because after that the new deadline is strict. Any new date the seller agrees should be recorded in writing between the conveyancers, including whether compensation runs until then.

Family help

Extra deposit from a relative lowers the loan to value, which can bring a replacement loan within a lender's limits. The money needs a gift letter and evidence of where it came from, because the conveyancer's money laundering checks include the source of funds where necessary (legislation.gov.uk: Money Laundering Regulations 2017, regulation 28). A relative can also offer their own property or savings as security, either for a bridging loan or through a family assisted mortgage, and in our experience family help mortgages are available up to 100% of the price. Anyone who offers their own property as security risks losing it if the loan is not repaid, and should take independent legal advice before agreeing. Our pages on gifted deposit mortgages and family help mortgages explain each structure.

Protecting a mortgage offer before completion

Several of the causes above are changes made between the offer and completion, so the weeks after exchange are the time to keep your finances and your job as they were. Your offer's conditions usually require you to tell the lender about a material change before completion. A change the lender finds for itself can lead to a withdrawal, and to harder questions from any replacement lender.

• Tell your broker before you change jobs, take on credit or agree a change in your pay between the offer and completion, so the lender can be told and its answer known first.
• Avoid new credit applications until completion, and keep existing accounts up to date.
• Check the offer's expiry date against the expected completion date, especially on a new build.
• Raise property and title questions early, so they can be resolved before exchange.

A change of job after the mortgage offer does not always end it. Whether the lender goes ahead depends on the offer's conditions and on how the new role compares with the one it assessed. Asking before you resign keeps that choice open.

How a replacement mortgage after exchange is arranged

1. Same day. The reason for the withdrawal, the completion date and the contract terms reviewed with your conveyancer, and the lender asked whether its reason can be resolved.
2. Route chosen. The same lender, a replacement lender or a bridging loan to complete, often prepared side by side, with more time asked for if the timetable needs it.
3. Application. A lender chosen for its speed and its fit with the reason for the withdrawal, with income, identity, credit and valuation documents ready before the application goes in.
4. Seller kept informed. Through the conveyancers, to agree more time where possible and to avoid a notice to complete.
5. Completion, then term finance. The purchase completes on the replacement mortgage, or on the bridge, which a remortgage then repays once the exit can be evidenced, using the redemption figure the bridging lender issues.

If your offer has been withdrawn, get in touch with the completion date, the lender's letter and the contract details. We check which routes can complete in the time left, and the lender makes the final decision.

Ten working days: the arithmetic of a withdrawn offer

An illustrative buyer exchanges on a £300,000 home with a £30,000 deposit, and two weeks before completion redundancy leads the lender to withdraw its £255,000 offer. The contract is on the Standard Conditions of Sale without changes, and the figures are hypothetical.

Step 1. The position at exchange

The buyer planned to complete with the £255,000 mortgage and £15,000 of their own money, which together with the deposit make up the price. The deposit is 10% of the price, the level the Standard Conditions set, and the mortgage would have been at 85% loan to value. Once the offer is withdrawn, the £255,000 has to come from somewhere else by the completion date, or the timetable in the table starts to run.

Step 2. The routes to completion

Three routes fit this buyer, and each rests on something different: the new income, the time left or the seller. A replacement lender needs the buyer's new income to support the loan, and after redundancy that income has to come from a new job a lender accepts. A bridge, for when underwriting cannot finish in time, needs security and an exit the bridging lender can rely on. A delay needs the seller to agree. Family help, another of the routes above, changes the figures in Step 3.

Step 3. What a delay and a bridge cost on these figures

Suppose the seller serves a notice to complete on the afternoon of the completion date and the buyer completes on the last day it allows, 14 calendar days later with no bank holiday in between. A notice given on Friday 6 November 2026, for example, runs to Friday 20 November 2026. Compensation at the contract rate of 7.75% on the £270,000 balance is £57.33 a day, or £802.60 for the 14 days. If the notice runs out instead and the seller rescinds, the £30,000 deposit can be forfeited and the seller can claim more, which makes the compensation small by comparison.

A bridge for the whole £255,000 at an illustrative 0.75% a month costs £1,912.50 of interest a month. The 0.75% is the calculator's starting rate, not a quoted rate. Over six months that is £11,475 of simple interest, so £266,475 would be needed to repay the bridge before any fees. Bridging lenders set their own maximum loan to value, and a bridge for 85% of the price may need security on another property as well. A family gift of £30,000 would bring the loan needed down to £225,000, which is 75% loan to value and can widen the choice of replacement lender. A buyer who had paid a 5% deposit of £15,000 would have to pay another £15,000 when the notice arrived, to bring the deposit up to the 10% the conditions require.

Illustrative figures before fees. The contract rate is the one in your contract, and the bridging rate, term and loan to value are examples, not lender terms. Not legal advice or an offer of finance.

What decides the case

Most of the outcome depends on what is done on the day the offer is withdrawn: involving the conveyancer, checking whether the reason can be resolved or the loan replaced in time, and arranging a bridge where underwriting cannot finish before the deadline. Keeping the seller informed through the conveyancers buys time before any notice to complete. Once a notice is served, every route has to fit within the ten working days that follow.