The best way to successfully buy that home you so want is to prepare beforehand and have secured a mortgage offer when you start your search. But how do you know what size mortgage you will need until you have agreed to buy a home? It can seem like a ‘Catch 22’ situation. In order to successfully buy the home of your dreams, it’s likely that you will need a mortgage. Not only can the process seem laborious and complicated, it can also be expensive and littered with requests for non-returnable bills! The mortgage approval process and the house buying process in general can be quite daunting to the first time buyer. It’s purpose is to guide the borrower and give some credibility to his/her offer when they find a home they want to buy. Furthermore, it’s important that the information you provide is accurate as this information will be the basis of the lender’s mortgage offer ‘in principle’ and any discrepancies may result in the offer being withdrawn entirely or changed.Īn AIP is, in effect, a stepping stone process between initial contact with the lender and the selected lender’s final binding mortgage offer. To obtain an agreement in principle you will need to provide quite a lot of personal information.
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How to get a Mortgage Approved in Principle? Not all AIPs and DIPs are made on the same terms but the reason they exist is to allow potential buyers to get a realistic idea of just how much they are likely to be able to borrow given their personal circumstances and the mortgage market at that time. Others call it a DIP (Decision in Principle). Many lenders refer to an ‘in principle’ mortgage offer as an AIP which stands for ‘Agreement in Principle’. What is a Mortgage in Principle?įirst of all, it has several different names although in their basic form they are all pretty much the same thing. It certainly helps strengthen a buyer’s position when they are making an offer on a property. We have discussed it before in other articles and obtaining a Mortgage in Principle is something we recommend.
You may have heard of a mortgage in Principle.
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