Customers looking to obtain a mortgage will need to get an Agreement in Principle first from a mortgage lender. As the name suggests, an Agreement in Principle is a simple way to find out the maximum amount you can borrow to buy or remortgage a property in Birmingham.
You will receive an Agreement in Principle before the final checks, and whilst you won’t be guaranteed to be accepted for a mortgage. It means you are on the right path. First Time Buyers in Birmingham will find these benefits because it gives them a better idea of which properties you can afford and makes it easier to make offers.
Despite what others may say, a Mortgage in Principle can be known as a Decision in Principle (DIP), Agreement in Principle (AIP). They are all just different abbreviations depending on where you are located.
Armed with an Agreement in Principle, you have opened yourself up to negotiating on any offers. As you have shown the seller that you are a ‘serious’ buyer who owns that property, you have the funds to proceed.
Nowadays, more lenders choose soft credit searches as they leave your credit score unaffected instead of a hard credit search which can leave a severe imprint, especially if you don’t pass each time.
Weren’t not saying that a soft search will not affect you either, but it is not something that tends to happen often as soft searches don’t go quite as in-depth. However, your lender will have reasons for choosing one of the two.
If you do not have hard searches done regularly, then having one done shouldn’t make too much difference. What starts becoming a problem is when you start having a lot of different hard searches taken out on you within a short time.
If you are already aware of how good your credit rating is, don’t be put off by the idea of having a soft or hard credit search done, especially if the lender suggests doing so is the most suitable option for you.
Unfortunately not, even armed with an Agreement in Principle, we cannot guarantee you’ll be successful with a mortgage as your lender will still need to see all documentation to make a final decision.
We have spoken to a handful of customers after their application declined, as they have to miss the small print that requires them to obtain an Agreement in Principle beforehand.
To demonstrate to your lender that you can handle your money responsibly and someone who looks like a good candidate to start your mortgage process, you will provide them with proof of ID, the last three months payslips and bank statements.
Please remember that Self Employed Birmingham mortgage applicants looking to obtain a mortgage have slightly different lending criteria to meet.
Most estate agents will ask you for one of these as they will need to know you can proceed with your mortgage application. It’s worth trying, but we believe you would be far better off having on in hand.
As a fast and friendly Mortgage Broker in Birmingham, one of our mortgage advisors has a track record of obtaining you an Agreement in Principle within 24 hours from the start of your initial appointment.
Take your time and care when looking for that ‘dream’ property. There is plenty of time not to jump at the first house you see as an Agreement in Principle sometimes expires after the 30-90 days mark.
Need a little bit longer, no problem, our team of Mortgage Advisors in Birmingham can quickly turn around a new one once you find a property that looks right for you and is ready to put down an offer.
To counteract the feeling of disappointment if your lender comes back and declines you, we recommend getting an Agreement in Principle as early as possible to ensure you are mortgage ready for the process.