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  • FIRST POST
    • nudda
    • By nudda 9th Jan 18, 5:52 PM
    • 114Posts
    • 26Thanks
    nudda
    decision in principle vs mortgage offer
    • #1
    • 9th Jan 18, 5:52 PM
    decision in principle vs mortgage offer 9th Jan 18 at 5:52 PM
    Hi,

    FTB here.

    My broker has said he will charge be £500 on "receipt of mortgage offer".

    a) Is this a reasonable charge?
    b) Is a DIP different to a mortgage offer ?

    Thanks!
Page 1
    • ACG
    • By ACG 9th Jan 18, 6:01 PM
    • 16,100 Posts
    • 8,278 Thanks
    ACG
    • #2
    • 9th Jan 18, 6:01 PM
    • #2
    • 9th Jan 18, 6:01 PM
    That is pretty much the way I do things.

    A Mortgage offer means the valuation and underwriting are both completed, so effectively the brokers job is more or less done.

    A decision in principle means yu have passed the initial credit check, but no underwriting or valuation has been carried out.
    I am a Mortgage Adviser
    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.
    • nudda
    • By nudda 9th Jan 18, 6:10 PM
    • 114 Posts
    • 26 Thanks
    nudda
    • #3
    • 9th Jan 18, 6:10 PM
    • #3
    • 9th Jan 18, 6:10 PM
    thanks!

    so does a DIP leave any footprint on your credit check ? (guesing it does but not sure if hard or soft)
    • Lolly88
    • By Lolly88 9th Jan 18, 6:11 PM
    • 265 Posts
    • 780 Thanks
    Lolly88
    • #4
    • 9th Jan 18, 6:11 PM
    • #4
    • 9th Jan 18, 6:11 PM
    thanks!

    so does a DIP leave any footprint on your credit check ? (guesing it does but not sure if hard or soft)
    Originally posted by nudda
    It depends on the lender, some do and some don't.
    House Fund - £32104.67
    Currently buying a house
    • nudda
    • By nudda 9th Jan 18, 6:16 PM
    • 114 Posts
    • 26 Thanks
    nudda
    • #5
    • 9th Jan 18, 6:16 PM
    • #5
    • 9th Jan 18, 6:16 PM
    Ok thanks!
    Is it true that multiple credit checks in 1 month dont have such a negative impact, as credit agencies understand these checks are done as part of searching for products? Worried that my credit ratign will go down if too many peoeple check within 30 days
    • Lolly88
    • By Lolly88 9th Jan 18, 6:29 PM
    • 265 Posts
    • 780 Thanks
    Lolly88
    • #6
    • 9th Jan 18, 6:29 PM
    • #6
    • 9th Jan 18, 6:29 PM
    No - that's not true as far as I know. Lots of hard searches in 1 month would still gives the impression that you have applied for a lot of credit in a short space of time and therefore indicating potential money management issues. But not all lenders do hard searches and you wouldn't need to be doing multiple decisions in principle anyway.
    House Fund - £32104.67
    Currently buying a house
    • nudda
    • By nudda 9th Jan 18, 6:38 PM
    • 114 Posts
    • 26 Thanks
    nudda
    • #7
    • 9th Jan 18, 6:38 PM
    • #7
    • 9th Jan 18, 6:38 PM
    that is interesting. I am looking at around 3-4 DIP's I guess
    • ACG
    • By ACG 9th Jan 18, 6:46 PM
    • 16,100 Posts
    • 8,278 Thanks
    ACG
    • #8
    • 9th Jan 18, 6:46 PM
    • #8
    • 9th Jan 18, 6:46 PM
    DO NOT get 3-4 DIPs.

    Some lenders do soft footprints so no real harm done, but getting it wrong could cause a lot of damage.

    Nobody needs anything more than 1 DIP.

    Check criteria.
    Check affordability.
    If happy it all fits, get a DIP.

    Why would you need any more than 1?

    I am of the opinion you do not need a DIP until you know how much you are buying for and are ready to apply. Rates and criteria can change daily so the best lender today may not be tomorrow.
    I am a Mortgage Adviser
    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.
    • E&G
    • By E&G 9th Jan 18, 7:38 PM
    • 29 Posts
    • 12 Thanks
    E&G
    • #9
    • 9th Jan 18, 7:38 PM
    • #9
    • 9th Jan 18, 7:38 PM
    So what can go wrong between DIP and mortgage offer from an applicant (rather than property not meeting valuation or lending criteria)?
    • ACG
    • By ACG 9th Jan 18, 8:03 PM
    • 16,100 Posts
    • 8,278 Thanks
    ACG
    The information may not have been entered into the dip correctly - the big problems here are overtime, bonuses, commission, benefits and commitments.

    I could get myself a DIP tomorrow for £300k but I could never get a Mortgage for that amount.

    Have a read on here how many people get DIPs and then their application is declined.
    I am a Mortgage Adviser
    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.
    • mr_munchem
    • By mr_munchem 9th Jan 18, 8:24 PM
    • 39 Posts
    • 10 Thanks
    mr_munchem
    I've got some decisions in principle today, and have only got ones that were very specifically soft searches - I think if I were to find a 'hard' search at this stage with an AIP/DIP I would go back to the reference agency and ask it to be corrected, as the banks are all very specific if it is a soft search!
    • nudda
    • By nudda 9th Jan 18, 9:04 PM
    • 114 Posts
    • 26 Thanks
    nudda
    DO NOT get 3-4 DIPs.

    Nobody needs anything more than 1 DIP.

    Why would you need any more than 1?

    I am of the opinion you do not need a DIP until you know how much you are buying for and are ready to apply. Rates and criteria can change daily so the best lender today may not be tomorrow.
    Originally posted by ACG
    So if I get Bank X DIP one day, and then on another day I choose a property and Bank Y has a better offer, what do I do? Am I forced to go with Bank X ? That's why I think it may require more than 1 DIP.

    Note: I am not claiming to be a an expert here.I am a FTB but keen to learn and want to get the best deal as the loan amount is not small so repayments can vary greatly by small changes in interest rate. I am here to learn and hope you folks can shed some light on these topics. Thanks
    • ACG
    • By ACG 9th Jan 18, 9:09 PM
    • 16,100 Posts
    • 8,278 Thanks
    ACG
    You can get as many DIPs as you want, but it is not a good idea.

    Get a DIP and then when you are actually ready to apply then you can do another DIP - but even then, it is only 2 DIPs maximum.
    I am a Mortgage Adviser
    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.
    • E&G
    • By E&G 9th Jan 18, 9:12 PM
    • 29 Posts
    • 12 Thanks
    E&G
    Thanks ACG, so as long as there's nothing of major concern (large discretionary spending with bookies etc) then DIP to offer should be fairly straightforward?
    • ACG
    • By ACG 9th Jan 18, 9:18 PM
    • 16,100 Posts
    • 8,278 Thanks
    ACG
    Should being the key word, but yes.

    Are you ready for the cheesy analogy?
    Imagine your Mortgage application is your new home. You want good foundations, so spend more time at the outset doing research and checking. Then you will spend last time snagging etc at the end.
    I am a Mortgage Adviser
    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.
    • nudda
    • By nudda 9th Jan 18, 9:25 PM
    • 114 Posts
    • 26 Thanks
    nudda
    You can get as many DIPs as you want, but it is not a good idea.

    Get a DIP and then when you are actually ready to apply then you can do another DIP - but even then, it is only 2 DIPs maximum.
    Originally posted by ACG
    Good point, although does getting 1 DIP mean chances of qualifying for other similar products is highly likely? For example, I have heard Barclays and HSBC are very picky. I guess you do those preliminary checks again and get the 2nd DIP then apply for the actual mortgage.

    I will get one DIP done, and go armed with that to put in offers. If something gets accepted, will look into whats new on the market product-wise then do a DIP and apply for it. Thats what I have understood ...
    • E&G
    • By E&G 9th Jan 18, 9:35 PM
    • 29 Posts
    • 12 Thanks
    E&G
    I'll take a cheese analogy as my cue to exit the thread but the advice is appreciated!
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