Decision in Principle

We're just about to start looking for houses, so have spoken to a mortgage broker (London & Country), and obtained a Decision in Principle from them (for our own piece of mind, as we're both first time buyers).

I thought they would need to do a credit check for this, but they didn't need to. Is their decision in principle therefore different to one of a bank? Or have I just made up the whole concept of a credit check at DIP stage?

Also, I had defaults galore 6-10 years ago, but none remain on my credit file (my whole credit file is clear now). Based on this, there is no reason I'd ever need to declare the old defaults, right? I'm not trying to hide anything from them, but it will be annoyingly difficult to get any paperwork and details on them as they're now so old.

Thanks in advance
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  • [Deleted User]
    [Deleted User] Posts: 35,242
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    tain wrote: »
    Also, I had defaults galore 6-10 years ago, but none remain on my credit file (my whole credit file is clear now). Based on this, there is no reason I'd ever need to declare the old defaults, right?

    You would, if they asked you.
  • amnblog
    amnblog Posts: 12,404
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    The Broker won't be lending you any money, so a decision in principle from them has about as much value as my promising you a tax rebate.

    When asked by a Lender (and you will be) about previous defaults, you can declare them.
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • Jkbc90
    Jkbc90 Posts: 85 Forumite
    We we got our DIP (via a broker with Nationwide) the credit search didn't show on the report until about 2 weeks later.
  • tain
    tain Posts: 711
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    Jkbc90 wrote: »
    We we got our DIP (via a broker with Nationwide) the credit search didn't show on the report until about 2 weeks later.

    They confirmed on the phone that they wouldn't be doing a credit check at this stage.
  • Jkbc90
    Jkbc90 Posts: 85 Forumite
    Oh sorry I didn't realise.
  • tain
    tain Posts: 711
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    amnblog wrote: »
    The Broker won't be lending you any money, so a decision in principle from them has about as much value as my promising you a tax rebate.

    When asked by a Lender (and you will be) about previous defaults, you can declare them.

    So will they have a burden on our chances of getting credit, even though they're older than 6 years and not on our file?
  • amnblog
    amnblog Posts: 12,404
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    It would be extremely unlikely (unless the debts were incurred with the Bank you approach for mortgage lending).
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • We applied for a DIP via Nationwide Online. I would suggest getting a DIP with the bank. It can be done online within 15 minutes then you can go straight onto the mortgage application once you have found your property.
  • tori.k
    tori.k Posts: 3,592 Forumite
    When we first considered buying we hit up L&C for some free advice there none credit checked verbal AIP gave us the ball park figure we needed to know for which house price bracket we were looking at. Our credit checked DIP our broker has done came out with the same numbers, so if you were honest with L&C there shouldn't be any issue.
  • kingstreet
    kingstreet Posts: 38,665
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    L&C don't do an agreement in principle until you have an accepted offer on a property.

    This is because it takes work and they know a high percentage will be picked off by lenders, other brokers and more often than not by estate agencies if they do them too early.

    They therefore send people out thinking they have an agreement in principle (like Nationwide or Santander's fully credit-scored version on which you can pretty much rely) when in fact all they have is a basic affordability calculation.

    Each to their own, but that is not how we roll...
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
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