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Final credit check before mortgage completion

Written By:
Myles Robinson - Expert Finance Advisor

Posted: Feb 16, 2023

Final mortgage credit check

It can be difficult to get a mortgage. Lenders can cancel their offer after reaching an agreement in principle (AIP).

This guide will help you understand what a mortgage lender looks for, how late a mortgage lender might decline your mortgage application, and what steps to take in case of an emergency.

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Why does a mortgage lender do a final credit check?

Mortgage lenders often conduct a final credit check before completion and making a binding offer. This can sometimes make people anxious.

If you’re concerned about what your mortgage lender may find if they recheck your credit check before completition. This article is for you.

This guide will explain the basics of final credit checks, how to increase your chances of passing them, and what to do if you have received a mortgage decline.

We hope you find the comfort you need in the topics listed below.

Constitute financial advice today, we have a few mortgage providers lending so we ensure to match you with the best mortgage lender for you.


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What is the final mortgage credit check?

The final credit check before completion is not necessary for most people who are buying a home. It should simply be an affirmation by the mortgage lender of your financial situation.

They will already have looked at you before your AIP.

  • Earnings evidence
  • Credit reports
  • Income and outgoings
  • Other outstanding debts
  • Age

The homebuying process can take a while and it is possible that several months have passed since the checks were performed. Your lender will want you to be certain that nothing has changed before they release funds at the completion stage.

This is typically the final step in the process. It takes place after contracts are exchanged. Your lender may withdraw your mortgage offer if your credit score has been affected or your affordability has changed.

It can be stressful to lose a sale at the last moment. A seasoned mortgage broker will be familiar with this scenario and can help you manage it if necessary.

Before making a final, binding offer, some mortgage lenders will double-check applications. This is done to ensure that your circumstances have not changed since the agreement in principle and to avoid missing any important points.


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When is the final credit check before mortgage completion done?

The final credit check may be performed at any stage of the process.

  • Just before the contract exchange
  • On the day of the exchange
  • After the contract exchange
  • Just before the completion

The mortgage lenders will typically conduct a hard credit check.

They will review your application carefully and double-check the details.

  • Your income
  • Outgoings and Debt
  • Credit history
  • Age
  • No. of dependents
  • If there are any risk factors, such as gambling history.

The lender will want to verify that your application has not changed. Lenders may be reluctant to make you an offer if your circumstances have changed, such as a significant pay cut or new credit problems.

People often feel anxious about a final credit review because they have noticed a drop in their credit scores since they applied for a mortgage.

This is temporary and common so that you can be sure. Lenders know that credit scores can drop after applying for a mortgage. Most will ignore this and assume this is the reason your credit score has fallen.


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What should a mortgage lender look for?

Lenders want to have complete confidence that you will repay the money they loan. When it comes time to final credit checks, lenders are simply doing their due diligence by reviewing your finances before granting the green light.

They will double-check:

  • What amount are you still owing on credit cards, loans or other mortgages? Has anything changed since your last check?
    • Important: Are you up-to-date with all your payments?
  • Is your credit score changing? What is the reason for this (if negative)?
  • Are you still working for the same employer?
    • What impact could this have on your ability to pay the mortgage payments?
  • Is your deposit still eligible for funds? If not, what’s the point?
  • To ensure that the valuation and condition of the property is the same, if it has been some time since the process started they might request a new valuation.

How to improve your chances of passing the final mortgage credit check

Talk to a mortgage broker if you are concerned that you may fail the final credit checks of your mortgage lender for something more serious.

It is in your best interests to do this. The right mortgage broker can help you pass the final credit check and increase your chances of success.

  • Assist in the exchange of contracts.
  • We will advise you on preserving your credit report ahead of final checks.
  • Find any problems that could hinder your application, and we will help you fix them.
  • If your circumstances have changed, you can renegotiate with your lender to get a loan.
  • If the lender discovers an issue, you can avoid losing any upfront fees.

If you have requested changes to your application, a mortgage broker can increase your chances of approval. If you have requested additional information or increased the loan amount, your lender may be more thorough.

Your broker will lead the negotiations and advise you on whether any changes could cause problems during final credit checks.


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What to do if your final credit checks fail

You may still have other options. You might have grounds to appeal the lender’s decision or negotiate a better deal with another mortgage lender.

Worst-case scenario: Your lender may withdraw your original AIP, and your mortgage won’t be approved. This will not happen until the problem that caused it is resolved. You won’t get the loan money to purchase your property if it isn’t resolved.

Lenders can withdraw an offer at any time if your circumstances change or if incorrect information was provided. This can sometimes happen even after the loan is completed.

This can be caused by inability to afford a home. Sometimes buying a house is a lengthy and tedious process. But life continues. New car finance is a common trap. Our network of advisors will remind you not to take out new credit agreements during your homebuying process.

These are the key takeaways from this guide

  • Lenders often conduct a credit check before granting a loan.

    Even if your circumstances have changed significantly, you can still apply for a mortgage. However, lenders may withdraw or modify a mortgage application before it is completed.

  • A qualified mortgage broker can pass these checks.

    They can help you plan for any problems and flag them up in advance. If your situation has changed, they can negotiate with your lender.

  • If you fail to pass the tests, they can help you.A broker can help you save your plans if your mortgage lender refuses to approve your application during final checks. They will assess your eligibility to appeal the decision of the mortgage provider and may be able to find you a better deal.
  • We can help you find the right mortgage broker for you:You should use a broker helping customers overcome that last hurdle. Our broker-matching service is free and can help you find that broker. Our service will match you with a mortgage advisor specialising in making mortgage approvals from rejections.

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Let us deal with the mortgage lenders for you

It can be very demoralizing to fail the final credit check after going through all of the steps. There are ways to prevent this from happening.

Even if the worst happens, it doesn’t mean all is lost. A professional mortgage broker will help you get back on track.

We will match you with an expert who can meet your needs.

Contact us for a mortgage and financial advice today with our mortgage brokers. We will ensure you match the lender criteria and have the best chance of getting a mortgage approved.


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