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Securing an excellent mortgage offer with Revolution Finance Brokers couldn't be easier
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Revolution Finance Brokers will finalise the details and enable you to move forward without delay!
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What Happens If I'm Made Redundant While Applying for a Mortgage?

Have you found yourself facing redundancy midway through a mortgage application? Our brokerage team explains the essential steps to take, what it means for your financing, and how to communicate the change of circumstances to your prospective lender.

You Just Got Redundant - What Does It Mean For Your Mortgage Application?

Redundancy is stressful at the best of times and can be a blow if you are in the middle of a mortgage application or just about to buy a new home.

One of the first steps before getting a mortgage after being made redundant is to ensure you have the best brokerage team to guide you through the process.

How Can I Manage a Mortgage Application Alongside Redundancy?

First up, it's crucial to communicate with your lender immediately - they will be far better placed to help you if you let them know straight away the issues you are dealing with.

You might be able to withdraw the application without incurring fees or delay the application process until you find a new role.

Generally, we would not recommend going ahead with a mortgage application if there is any doubt about your financial situation. If you are asked about the risk of redundancy and omit to share this on your application, you could be at risk of a fraud prosecution.

However, if you have another income stream or savings that will cover the repayments, you might still be ok to proceed, provided you let the lender know about the circumstances.

What Happens if I am Made Redundant with a Mortgage Agreement in Principle?

Your agreement in principle is an initial offer to lend in advance of finalising the purchase process. A lender might decline the full application or decide to change the offer.

If your redundancy renders your mortgage unaffordable, the lender will likely withdraw the offer.

Remember that every lender has a different affordability assessment policy. Therefore, if one provider withdraws a mortgage offer owing to redundancy, another might consider the loan depending on how you plan to make the repayments.

Can I Accept a Mortgage Offer if I am Redundant?

We advise thinking very carefully before accepting a mortgage offer if you have been made redundant or think it might happen. If you cannot keep up your repayments, you could end up in a repossession scenario.

That means losing your home and having a severe issue on your credit record.

Is Remortgaging an Option in a Redundancy Situation?

If you already have a mortgage and are facing redundancy, you might decide to remortgage. A lot depends on the circumstances and what you owe, but there are many options out there.

Remortgaging over a longer-term could extend the end date of your mortgage and reduce your monthly payments.

You might not be offered a remortgage deal if your loss of an income impacts your ability to make repayments, but if you have a joint mortgage, for example, and your partner can cover the costs, you are more likely to be approved.

Lenders can also offer mortgage holidays, whereby you have a period of not having to make payments without remortgaging while you search for alternative employment.

A further option is to switch to an interest-only mortgage, even if just in the short-term, to reduce your monthly cost until you stabilise your finances.

Does it Make a Difference to my Mortgage If I Accept Voluntary Redundancy?

Voluntary redundancy is sometimes offered with a generous settlement package. You can consider remortgaging or potentially downsizing in advance of volunteering in this situation.

Expert Advice with Mortgages and Redundancy

Being made redundant can be challenging, but by acting quickly and seeking expert support, you are likely to find a solution to avoid ending up in financial difficulties.

If you have been made redundant but you still want to apply for a mortgage, our expert brokerage team can help.

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