What Happens If My Lender Changes the Terms Before Closing?
Move fast, and watch your mortgage contingency date. What to do if your lender asks for more money down or can't deliver, how switching lenders works mid-deal, and why extensions belong in writing.
Act the same day. Your mortgage contingency date is the clock that protects your deposit. If your lender changes the terms, asks for a much larger down payment, or can't deliver a commitment, call your agent and attorney right away. Find out whether a different lender can do the loan on time, and get any extension in writing before the deadline passes.
Why would a lender change the terms?
- Something changed in your file: income, debts, credit or employment.
- The property raised a problem: appraisal, condo approval, or condition.
- The lender's own guidelines or investors changed.
- The original approval wasn't solid. Strong pre-approvals prevent most of these surprises.
What should I do?
- Get the change in writing from the lender, with the reason.
- Call your agent and attorney the same day.
- Get a second lender on it right away if the first can't deliver. A new lender needs your documents fast and may need its own appraisal.
- Ask for an extension before your contingency date passes, in a signed amendment. The seller may agree, or may ask for something in return.
- Don't miss the date. After it passes, your deposit is usually at risk if you can't close.
What does this look like in practice?
On one deal, the buyer's lender suddenly asked for a much larger down payment than planned. We brought in a new lender and asked the seller's side for one final extension, with a modest increase in price offered to make the extra time worth it. It wasn't free, but it kept the purchase alive. The lesson: work with a lender you trust from the start, and treat the contingency date as a hard deadline.
Questions people actually ask.
Can I switch lenders after my offer is accepted?
Yes, but it takes time. Do it early, and tell your agent so the seller's side isn't caught off guard.
Will switching lenders hurt my credit?
Multiple mortgage credit checks within a short window are usually treated as one. Ask your new lender.
Can the seller refuse an extension?
Yes. That's why acting early matters. See mortgage contingencies.
This article is general information about Massachusetts real estate, not legal, tax, or financial advice. Every property and transaction is different. For advice on your situation, talk with me and, where appropriate, an attorney, lender, or tax professional.