Mortgage Agreement In Principle (AIP)
If you’re looking to purchase a property, either as a first time buyer, home mover or investor. You may have been told by an estate agent you need an agreement in principle. Some estate agents (rightly so) won’t allow you to view a property without one. If you’re wondering why, keep reading!
What is an Agreement In Principle (AIP)?
An agreement in principle is a provisional acceptance for your mortgage. Your mortgage broker will approach the most suitable lender on your behalf. We have access to their sophisticated systems where we provide them with your personal details, financial situation and your requirements – they run a credit check and confirm if they’re happy to consider you for a mortgage.
Once accepted you’ll receive a certificate confirming how much you can borrow. You can provide this certificate to an estate agent to confirm you’re proceedable.
Why do you need an Agreement In Principle (AIP)?
An Agreement in Principle will not only give any potential estate agent and seller confidence to agree a sale to you it will give you peace of mind that you are able to obtain a mortgage in advance of you falling in love with your dream home to later find there’s an issue that could have been picked up and resolved earlier on. It also means you’re going to be in a position to act quickly if you do find a property you like.
How reliable are they?
They’re only worth the paper they’re written on if the information that’s been provided to the lender is accurate. This sounds like common sense and for the most part it is. However, every lender has different criteria, eligibility, acceptable income and employment types, credit scoring thresholds and LTV limits. So, if you’re thinking of doing this yourself or using an online broker that hasn’t seen any of your proof of income / bank statements then think again! You may receive an agreement in principle but when it comes to full application (once you’ve found a house) there’s a good chance your mortgage will be declined.
Where can you get an Agreement In Principle (AIP)?
As per the above, for an accurate, reliable AIP speak to us first! We will shop the market to find you the best mortgage deal and provide you with an agreement in principle that is most suitable to your individual circumstances.
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