An (AIP) Agreement in Principle or as some people call it a Decision in Principle, is where you pass a lenders credit score to qualify for a potential mortgage.
It’s handy for the first time buyer in Bristol to have an Agreement in Principle ready, and this will help support any offer they made.
In some cases, you may be able to negotiate a lower price if you obtain one of these as it gives the seller confidence that you are serious about having the funds to proceed.
We see more Lender choose to go with a soft credit search. However, some may still affect your credit score. Additionally, this can be the case if you decide to go with a hard inquiry, but from our experience, a soft search should leave your credit score unaffected.
Soft searches don’t dig as deeply as hard searches, though you can trust that the Lender made the correct choice either way.
As long as you don’t do it regularly, then the odd hard search should not male too much of a difference. It only becomes a problem if you start having multiple hard searches within a small space of time.
In any case, if your credit rating is right and you know it, do not let this put you off, especially if taking a hard search with that Lender is the best deal.
Sadly there are no guarantees that having an Agreement in Principle will get you a mortgage. The Lender will still need to see all your documents, and only then will an Underwriter make the final decision.
Often customers have gotten in touch getting because they get declined at the application stage, due to missing some small print in their Agreement in Principle.
You will need to provide ID to prove that you are genuine, payslips to prove you earn the amount you claimed, and bank statements to prove you conduct your finances before a lender offers your case.
It is possible to make an offer without an Agreement in Principle. However, we strongly would not recommend it. An Estate Agent with credibility will want you to prove you can proceed.
It is possible to obtain an Agreement in Principle within 24 hours of speaking with a Mortgage Advisor in Bristol.
Usually, an Agreement in Principle will expire after 30-90 days. You do not need to worry, though as this does not mean you should apply for the first house you find.
If your Agreement in Principle expires, you can quite easily have it refreshed when you are ready to make an offer. Finding a mortgage only to be declined a mortgage can understandably be disappointing. As such, we recommend getting an Agreement in Principle as early as possible.
Date Last Edited: January 12, 2024