What is an agreement in principle?
A mortgage agreement in principle (AIP), also known as a decision in principle or agreement in principle, serves as a valuable tool for homebuyers in Leicester. It provides an estimate of the potential borrowing amount before formally applying for a mortgage.
To secure an AIP, a soft credit check is conducted, minimally impacting your credit score. Obtaining an AIP comes with no obligation to proceed with a mortgage application.
At Leicestermoneyman, our goal is to deliver an AIP within 24 hours of your initial mortgage appointment. The agreement is valid for 30-90 days, ample time for property search, and can be easily renewed if it expires.
How to Get an Agreement in Principle in Leicester
When seeking a mortgage agreement in principle, you have two options. You can directly contact a mortgage lender or enlist the assistance of a trusted mortgage broker in Leicester, such as us.
Our experienced mortgage advisors can liaise with the lender on your behalf, ensuring a swift AIP process.
We offer a complimentary mortgage appointment for every customer, where expert advice is provided, and your AIP is delivered within 24 hours.
To progress with the application, proof of income, employment details, credit history, and other personal information are required, offering an estimate of the borrowing amount.
When to Get an Agreement in Principle in Leicester
Obtaining a mortgage agreement in principle before starting your property hunt is advisable. It provides a general idea of your borrowing capacity, allowing you to focus on properties within your budget.
Additionally, having an AIP can enhance your position when making an offer, as sellers and estate agents often view it as a sign of a serious buyer.
However, it’s important to understand that an AIP doesn’t guarantee mortgage approval; further assessments occur during the full application process.
Information Required to Get an Agreement in Principle in Leicester
When applying for an agreement in principle, the mortgage lender will need specific personal information to assess your eligibility and determine the lending amount.
This includes details like income, employment status, credit history, and relevant personal information. Additional documents may be requested, such as bank statements or proof of income, to inform the lender’s decision.
The Difference Between an Agreement in Principle and a Mortgage Offer
An AIP outlines the potential lending amount based on provided information, without forming a legal contract. A mortgage offer, on the other hand, is a formal, legally binding agreement from a lender, confirming their willingness to lend after thorough checks.
Understanding the distinction is key; an AIP aids in estimating borrowing capacity, while a mortgage offer comes with legal implications.
Impact on Your Credit Score in Leicester
Obtaining an AIP usually has minimal impact on your credit score, often involving a soft credit check. While some lenders may perform a hard credit check, visible on your report, during the AIP process, it’s essential to note that the mortgage application itself typically involves a hard credit check.
Limiting applications and applying for an AIP when serious about a property purchase is advisable.
The Benefits of Having an Agreement in Principle in Leicester
An AIP offers benefits in the mortgage journey, providing clarity on borrowing capacity, helping focus on suitable properties, and potentially expediting the application process.
It can enhance offer acceptance chances, as sellers and agents often favour buyers with an AIP, showcasing commitment and active mortgage efforts.
Cost of an Agreement in Principle
Typically, obtaining an AIP is free of charge, representing a lender’s willingness to lend based on provided information. Our mortgage advisors in Leicester can arrange your AIP at no cost; reach out for a free mortgage appointment.
Rejection of an Agreement in Principle
Rejection for an AIP doesn’t guarantee rejection for a full mortgage application. Understanding reasons for rejection, exploring alternatives, and avoiding multiple AIP applications are advised. A mortgage broker can help in finding the right lender and navigating the process.
Get Your Agreement in Principle in Leicester Today!
For first time buyers in Leicester or those moving home in Leicester, speaking with a mortgage broker like us for an AIP before making offers is recommended.
Our experienced mortgage advisors in Leicester aim to provide an AIP within 24 hours, guiding you through the mortgage journey. Book a free mortgage appointment to start your journey with a trusted broker in Leicester.
Date Last Edited: December 20, 2023
