Obtaining a mortgage agreement in principle (AIP) is a key part of the mortgage process. As a mortgage broker in Nottingham, we would advise that you secure an AIP as soon as possible.
You may also know an AIP by the name ‘decision in principle’. They mean the same thing; depending on the lender that you use, they may change what they call it.
An agreement in principle is written verification that a lender will let you borrow from them. However, this is only ‘agreed in principle’ – in principle of you being able to provide sufficient, evidential documents to back up your application.
An AIP can be obtained before your mortgage broker in Nottingham, lender or building society start performing credit checks, taking documents from you etc. This is why we advise that you get an AIP as early on in the process that you can.
Having an AIP in place early will not only show that you’ve been accepted by your lender and can borrow from them for a mortgage, but it can also put you above other potential buyers.
Remember, an AIP shows that you’ve had an offer accepted in the principle that you can support your application. So, if you’re currently viewing houses, you may be putting yourself in front of other viewers who don’t have one in place.
Sometimes, they can also allow you to negotiate prices. If your maximum mortgage amount is lower than their asking price, you may be able to speak to the seller and try and work out a price reduction.
As a mortgage broker in Nottingham, it’s our job to guide you through the whole mortgage process, therefore, we can also assist you with obtaining an agreement in principle.
After your free mortgage consultation with a mortgage advisor in Nottingham, we can arrange an AIP for you within 24 hours!
There are other ways to obtain an AIP. In most cases during the mortgage process, your bank, building society will automatically get one arranged for you.
Since an AIP is only ‘agreed in principle’, they do have an expiry. Usually, they are valid for around 30-90 days.
If your AIP expires, you can easily get another one. It’s a simple process; go speak to your mortgage advisor in Nottingham, bank, building society or whoever you got one with the first time around, and they should be able to arrange another one for you.
AIP’s usually expire when a buyer is struggling to find a property that they want to buy.
In some scenarios, yes, you can make an offer on a property without an AIP. However, as mentioned before, having one in place may boost your chances of getting your offer accepted as you’re ready to proceed through the process straight away.
Not having one in place could slow your process down and sellers will not want this – particularly if they’re looking for a quick sell.
Occasionally, we’ve found that estate agents with credibility would rather that you prove that you can proceed first.