No – whilst it puts you in a good position for getting a mortgage, there is no guarantee.
Will an agreement in principle guarantee a mortgage? Changes that would normally determine the need for a new AIP would be increased debt, loss of income or increased regular spending. Sometimes, a change in circumstances can mean that your original agreement in principle is no longer valid, so you would need to obtain a new one. Check before applying to see what your lender is offering. Typically, an agreement in principle lasts 90 days, although some lenders offer them for just 30 days. How long does an agreement in principle last? Equifax and Experian are two of the most common.
This will let you view your full report and have a better understanding of your current rating. If you are unsure of your credit score, you could always contact one of the leading credit agencies. Too many hard checks in a short period of time could really damage your potential to borrow in the future. It is always advisable to check what type of credit check will be conducted. This leaves what is known as a footprint on your score. Some offer the soft credit check, which doesn’t do any damage to your credit score.
Yes and no – it all depends on which bank or mortgage broker you go to. Does an agreement in principle affect my credit score? Be prepared to show them:Īs well as reviewing this information, a soft credit check will also be performed to see if you fit the required criteria. Without it, they will not be able to proceed. What do I need to get an agreement in principle?īefore contacting the bank, you will need to make sure you have all the information they may need. Too many applications for one could severely harm your credit score. Most estate agents would want to see one before going any further.Īs with any financial undertaking, it would be sensible to get advice from a variety of lenders before proceeding with an agreement in principle. Ideally, before you start deciding on a potential new house, you should get an agreement in principle. When should I get an agreement in principle?
This is simply what the bank may offer, should you apply for a mortgage. Just remember, this is not to say you now have your mortgage. If that decision is in favour of lending, you have your AIP, meaning you can now start looking at properties within your budget. You’d normally have confirmation within 24 hours. By providing the bank or broker with the required information, you could receive an answer almost immediately. You simply visit the bank or apply online to see how much you could be eligible to borrow. You have saved for long enough and are now hopefully making your first steps towards getting onto the property ladder.Īn agreement in principle, or AIP, is where you take those first steps. Perhaps you are currently looking to apply for a mortgage. Let our property experts at SOLD.CO.UK clear that up for you with this handy guide. The agreement in principle – another one of those property terms you may have heard of, but possibly don’t understand.