Decision in Principle - further checks?

alligator18

Hello

Myself and partner have recently been accepted in principle for a mortgage with Nationwide (we are first time buyers).

Just now we applied for a £2,000 unsecured loan with Sainsburys to help with legal costs, but got declined . We have had a few credit checks recently as we had another DIP completed by another broker. We have nothing bad on our credit history, so I'm assuming it's the multiple checks?

Now I'm worried that our mortgage offer may be affected. Do they check your credit file again after you have an agreement in principle? Now that we have a decline from Sainsburys I'm starting to stress!!!:huh:

iscrimger

Do they check for an agreement in principle? From my agreements I've had they've only agreed on the basis of the information I provided being correct - the actual credit check will follow when you actually apply for the mortgage.

I have to say Sainsburys Finance does seem to be a bit funny over who they accept. I applied to them a few years ago and was declined - I was successful with 2 others. (I only took one naturally).

Try ordering your credit report to find out exactly what's on it. Electoral Register, high balances on current credit, missed payments or lack of credit history could all have an impact on your borrowing.

Oh I did goto Northern Rock for a mortgage in principle and they did search my credit record but no-one else did. I was slightly annoyed at NR as they didn't advise me this would happen and it had an impact on my score! Almost 3 months past now so it's behind me almost.

tek-monkey

Co-op didn't do a check until I actually applied, the agreement in principal seemed to just be plucked out of the air. Didn't even ask me about my outgoings!

luckyfool

Most lenders will credit check at agreement in principle stage, including Nationwide. I wouldn't worry too much about it.

Balarissa

Just a thought but perhaps having the unsecured loan might have an impact on your mortgage application? We are currently 18 months through a 36 month loan with £3300 left to pay and our mortgage broker advised us that, whilst it wouldn't make a huge difference, they would look more favorably if we had it paid off already as they will calculate it into what we can borrow. Would there be any chance of privately borrowing from a very trusted friend or family member who wouldn't want immediate repayment so it wouldn't be flagged on your credit check and you could pay back down the line when you have settled into paying the mortgage?

TheMiner

luckyfool wrote: »

Most lenders will credit check at agreement in principle stage, including Nationwide. I wouldn't worry too much about it.

Nationwide didn't for me!!

dmp1980

A&L have approved me in principle and they did credit check me - it has appeared on my experian report.

luckyfool

Did you get an approval in principle certificate from a broker . . . if so then it was credit checked. If you were in branch and the mortgage advisor didnt do a proper agreement in principle then maybe you weren't checked, but thats because you didnt get an agreement in principle.

benjo

My lender did a credit check on the day they gave an AIP, there were no other recorded checks - at least on experian (I didnt check the others) so as others have already said, they have probably done their checks and you dont need to worry about that...

However, Im pretty sure that sometime soon there will be some paperwork arrive from your lender, asking you to sign saying that your details are as you have told them - and they wont be the same if you take out a 2k loan, in theory you would have to declare this 'I think', Im not an advisor, but just sharing my recent experience of the paperwork side of things.

'I think' if your circumstances have changed, then they could well recheck your credit. If you are asked to confirm that nothing has changed etc it must be very tempting to say nothing and keep your fingers crossed - but that would be dishonest/fraudulent and it could open up a whole can of worms that you will repent at leisure.

Unless the purchase is complicated I wouldnt think your legal costs will be as high as 2k, save, work over time, ask your parents for an early christmas present, sell your unwanted stuff and goodluck.

sgh1976

RBS did credit checks on myself and partner before giving us an offer in principle.

Just been speaking to our IFA and he said RBS should have completed our application by close of play yesterday. So waiting to here the decision, hopefully a yes (as long as surveys etc are ok).

Just checked on Equifax and the only credit checks carrie dou tby RBS are the ones they did back in June.

alligator18

Thanks for all the replies. We have already been credit checked by Nationwide, and yes our application was put through a mortgage broker.

As mentioned in my original post, we were then turned down for the 2K Sainsburys Loan, so we are using other savings to pay for legal costs/valuation fees as we don't want to keep having refusals on our credit report. So we don't have anything new to declare on our application.

I think my main worry was that Nationwide would carry out another credit search before we received a formal mortgage offer and if the decline on our record would look bad.

I guess we'll just have to wait and see. Hopefully it will work out!