Can I Change the Property on My Mortgage Offer? Thus, in all the general sense, one can alter the property on the mortgage offer, but not easily. while applying for a mortgage it is very important to choose the property which you want to buy. But they can, and sometimes they do, and you might want to change the property you are buying after a mortgage offer has been issued. To help answer that question – can I change the property on my mortgage offer? – this article will give you all the necessary information.
Understanding Mortgage Offers
A mortgage offer on the other hand is a legal written communication from the mortgage provider on the stated terms of the offered mortgage credit, its terms and amount. The offer is generally made when the lender has evaluated your credit position and the equity of the property being bought.
Variation of Property in the Mortgage Offer
Can I Change the Property on My Mortgage Offer?
Thus, in all the general sense, one can alter the property on the mortgage offer, but not easily. It is different for each organization and depends on the desirability of the loan. Here are some factors to consider:
Lender’s Policy
Depending on the nature of the offer some lenders may not have a problem if you change the property while others may strictly follow the offer. You should also take time look at the mortgage offer document you’ve signed and consult with your lender whether or not they allow property changes.
Revaluation
The lender is likely to request for a revaluation of the new property in the event that you wish to change the property on your mortgage offer. The new property is valued by a valuer which is an extra expense in the whole procedure. This valuation will help the lender decide whether the new property is right for the mortgage.
Credit Check
If the new property is again costlier than the first one, then the credit check might have to be done all over again by the lending company. This should be done in order to be in a position to meet the enlarged mortgage payments.
New Mortgage Application
At times, the lender will action the change of property as a new application for a home loan and therefore, you would be required to make a new application. It can be a time-consuming process and may attract extra costs.
When Can You Change the Property on Your Mortgage?
You can typically change the property on your mortgage in the following situations:
Before Exchange of Contracts: If the property you are using to raise finance is still under offer, and you have not signed contracts, then it is quite easy to switch the property for a mortgage offer a lot of the time.
During the Cooling-Off Period: It is important to note that some lenders allow the borrower to reverse his or her mortgage application or choose another application within a week to two weeks without charges.
With Lender’s Consent: Even if you have already signed contracts, you are still likely to be able to switch the property in your mortgage offer if this has not already been done with the permission of the lender. However, it depends on the policy of the given lender and may be subjected to extra charges and conditions.
4. Consequences of Changing the Property on Your Mortgage Offer
But although you can change the property on your mortgage offer, there are limitations and possible unwanted consequences. Some of the implications you should consider include:
a. Lender Approval: Mortgage lenders are also likely to evaluate the new property, plus your current credit standing before they can approve the change of a mortgage offer. The lender may not approve the change if your new property is worth less than your current home, or if your credit rating has dropped.
b. New Terms and Conditions: However, if the lender allows you to change the property within the mortgage offer it then would present terms and condition that are different from the one you agreed with. This is where it may include either the interest rates increase, the repayment period changes, or any other post that may go on to affect the monthly installment to be paid.
c. Prepayment Penalties: For the case of home loan refinance or acquiring a new home loan, it is important to consider any prepayment penalty. These fees can be fairly high and may even erase any benefit you would gain from changing the property.
Conclusion
Thus, switching of the property in Mortgage offer does make sense, but, like everything else, they have risks and disadvantages associated with their use. The options will be contingent upon your conditions, your existing mortgages and the rules set by the lending firm where you got your loans from. In such a case, one is expected to make his/her time, study the price and then get a help of a financial expert or mortgage broker. Just a reminder – the purpose of this is to defend your investment and the ability to make changes to the property if you need it when you get your mortgage offer. You can contact us here.
