Should I get a mortgage before finding a property?

Former_MSE_Archna

Q. I heard estate agents & seller's take you more seriously if you've a mortgage in place before you look for a property. But I don’t want to waste a credit search, so should I wait to apply? Tina, by email

A. Few lenders offer actual mortgages if you've no property in place; instead it's a ‘mortgage in principle’, which provisionally lets you know much you can borrow, subject to finding a suitable property within a specified length of time. This does mean a credit check, though one mark on your file isn't too big a deal (see the Credit Rating guide)

In reality, even a mortgage in principle is never guaranteed, as the lender will want to do a valuation too, though it can speed the process up once you find the house of your dreams. Though you should always check whether you can better deal after you’ve found a property.

Plus mortgage rates are shifting daily, so the product mightn’t be around in a few months’ time. Yet it’s still vital to get an idea of how much you're going to be able to borrow, to you look at properties in the right price bracket and give estate agents more confidence. A decent mortgage broker will often be able to help give the idea of what you can borrow (see the Cheap Mortgage Finding guide)

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crabcakesfordinneragain

I followed MSE's recommendations and got my mortgage through London and Country.

They recommended that I waited until getting an offer accepted before getting an MIP because with a much clearer idea of what we'd be looking to borrow and against what type of property, we could probably get a much better rate. They were absolutely right - we got a mortgage deal which came on the market that day and will save us quite a bit of dosh. The MIP bit was all done over the phone anyway, and came through within 24 hours, so hardly took anytime at all.

Only issue is that some estate agents/vendors can be difficult if you don't have one. Our broker told us to give them his number if they wanted verification that we were serious. They all seemed to be happy with that.

mrs_smith_2

I recently applied for a mortgage in principal from Britannia and was told it would not involve a credit check so was surprised to see this reply. Is this unusual?