If the home hasn't been reserved and taken off the market yet, you can back out of the offer process without any penalty or costs. A tenant can back out of the offer process by cancelling their offer if they haven't paid the holding deposit yet.
However, if the home has been reserved and taken off the market, backing out at that point means the owner has missed out on valuable time on the market and potential offers from other renters. If you back out of the offer process after reserving the home, some or all your holding deposit will be deducted based on how much time has passed.
It should take a maximum of a week, 7 days, from when a renter reserves a home to when they sign the tenancy agreement. However, it is the renters responsibility to supply their referencing information as soon as possible. The holding deposit will be split into seven payments that will be returned to you on a pro-rata basis. If you back out earlier in the process, you'll be refunded most of the holding deposit, less a small amount. If you back out or your referencing takes longer than 7 days, you'll most likely lose all of the holding deposit.
PropertyLoop works in line with government legislation on a capped 1 weeks holding deposit to reserve a property https://www.gov.uk/government/collections/tenant-fees-act.
Jennifer has accepted an offer and reserved the property by paying the holding deposit, a fee of one week's rent, which in this scenario is £700. If she changes her mind and decides to back out two days after the home is reserved, £200 will be deducted from her deposit. Logically, this means £500 from the deposit will be refunded to Jennifer within 24 hours of her cancelling the offer.
£700/7 days (how long the process takes on average) = £100
£100 * 2 days (how much time has passed since I've reserved the property) = £200
£700 - £200 = £500 (remaining deposit that will be refunded to me)