Decision in principle

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883508
883508 Posts: 29 Forumite
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in Mortgages & endowments
Looking to move house soon so would like a decision in principle however,we have some debt but that will all be paid off with our Equity.
Can a lender base their DIP with my debt having been cleared?

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  • hunt85
    hunt85 Posts: 332 Forumite
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    Yes absolutely and then it is a condition of the mortgage that the debt is paid which is checked by lender/solicitor later.
  • Jb_1982
    Jb_1982 Posts: 68 Forumite
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    I'm sorry I can't help with the original post, but can I just ask a question as a beginner.

    How reliable is an agreement/decision in principle? Do you often get a decision in principles fail to come to terms?
  • 883508
    883508 Posts: 29 Forumite
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    hunt85 wrote: »
    Yes absolutely and then it is a condition of the mortgage that the debt is paid which is checked by lender/solicitor later.

    Excellent thank you
  • hunt85
    hunt85 Posts: 332 Forumite
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    Jb_1982 wrote: »
    I'm sorry I can't help with the original post, but can I just ask a question as a beginner.

    How reliable is an agreement/decision in principle? Do you often get a decision in principles fail to come to terms?

    It depends how accurately the DIP is completed so if you're unsure seek advice don't just do one yourself online, see a broker or go direct to your chosen bank.
  • Jb_1982
    Jb_1982 Posts: 68 Forumite
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    My DIP was completed by a broker, and the DIP was given by nationwide, I assume that's a reputable route? So how likely is it to accepted under those circumstances?
  • hunt85
    hunt85 Posts: 332 Forumite
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    Should be fine then just be guided by your broker.
  • kingstreet
    kingstreet Posts: 38,788 Forumite
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    883508 wrote: »
    Can a lender base their DIP with my debt having been cleared?
    Some will. Some won't.

    Lender selection is critical on this issue.
    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.
  • 883508
    883508 Posts: 29 Forumite
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    kingstreet wrote: »
    Some will. Some won't.

    Lender selection is critical on this issue.

    We are using an experienced mortgage broker so hopefully he knows his stuff on this issue.
    Is Nationwide one of the lenders which do?,only we do our banking with them so just curious.
  • hunt85
    hunt85 Posts: 332 Forumite
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    Yes Nationwide certainly do. They ask what debt you have and what amounts of that will be cleared "on or before completion"

    Most big lenders take this into account otherwise they wouldnt do much business i expect as everyone would come out unaffordable.
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