Can a mortgage lender change their mind after final approval?

Question

We just received final approval on our mortgage! It's been 2 months since the offer was accepted. I have been so nervous through this (with banks falling apart and all that). Is it pretty much set now? Is there any chance the bank could back out now?

Answer 1

The only thing that will derail this at this point is a significant change in your status i.e. you make a major purchase on credit (car, a houseful of furniture), your employment status changes (you quit your job) or the property is destroyed.

I always tell my clients, NO changes, no purchases, nothing new until the transaction is completed.  

Answer 2

The bank can back out but it would have to be an extraordinary reason such as a fire that damages the property or discovery of a defect on the title that causes them to take such an action.

Answer 3

Did you get FINAL approval or PRE-approval.

Final approval will come a couple of days to a week before your closing.

If you have final approval, you are good to go unless you do something dumb like quit your job or run out and buy a car.

Answer 4

I'm sure everything will be fine!  I think the only way the deal would fall through is if the bank went out of business before you closed...and that is unlikely.  I don't think this is something to stress over.

Answer 5

Have you signed anything in legal writing?  If so, you should be fine.  Especially, since it has been 2 months you have documentation that a contract has been signed and agreed upon.  Your worries are for nothing of course being that there have been incidents where people were getting ready to move in with hired movers and than at the last minute the lender bailed.  I know that was not a very good analysis, but all in all if you received final approval you should be good to go.  It is ok to worry because as we all know anything can happen these days.  To get a more peace of mind talk to your lender and go over the paper work again.  Good luck and congratulations.!!

Answer 6

They can still back out, but its unlikely now.  Final approval means they checked everything and it looks ok, so go ahead and close, but if they now find something (or jsut can't finance it or something) they can still rescind their final approval.  Anyhow, that fact that they gave you the final approval is very promising - it sounds like it will go ahead an close now.

PS - What bank were you using, 2 months is to long so I'm curious as to where you had these problems.