"Cost" of getting a mortgage in principle

wearethedogs

I am currently looking for my first home. I understand that when I put an offer in, in order to be taken serious, I should seek to obtain confirmation from a mortgage company that they will lend me what I need.

My question is whether there is any cost involved in getting this mortgage offer in principal? I am in no rush to find a house and want to hold out for the right place at the right price. This could mean I put in an offer for a house next month, but if I cannot get it for the right price, it could be a year or more until I actually buy a place. In this scenario would I potentially have to pay multiple arrangement fees, or is there no cost in getting a mortgage in principle until you complete?

Similarly, at what stage is the credit check performed?

Thanks

19lottie82

There is no cost of getting an agreement in principal but bear in mind that you will need a minimum of ten percent deposit to buy a property plus more cash for legal fees.

Also an agreement in principal will not be valid forever, I think the norm is 90 days

wearethedogs

Thanks for the response. The deposit and cash for fees for the actual purchase is not a problem.

Can I just get an agreement in principal, and if I dont end up being successful in getting a house get a further agreement in principal next time I see a house I like?

Thanks.

19lottie82

wearethedogs wrote: »

Thanks for the response. The deposit and cash for fees for the actual purchase is not a problem.

Can I just get an agreement in principal, and if I dont end up being successful in getting a house get a further agreement in principal next time I see a house I like?

Thanks.

Yes that's right, you'll just need to re apply if the original AIP has expired

kingstreet

Each full search leaves a footprint on your credit file which remains visible to other lenders for upto twelve months. Don't have too many AIPs done. One, close to when you intend to offer, should be enough.

wearethedogs

kingstreet wrote: »

Each full search leaves a footprint on your credit file which remains visible to other lenders for upto twelve months. Don't have too many AIPs done. One, close to when you intend to offer, should be enough.

Ok thank you, so whilst there is no cost, the lender does a full search which will appear as a mortgage application on my credit file.

Arthur_Sleep

19lottie82 wrote: »

an agreement in principal will not be valid forever, I think the norm is 90 days

This seems to be the case generally, but in the case of Yorkshire BS it's only 30 days which seems unhelpfully short to me. I really hope there isn't anyone out there diligently getting a fresh AIP every 30 days until they have an offer accepted, as presumably they won't be aware of the damage they're doing to their credit records. :doh:

Am I right in thinking that, generally speaking, an estate agent would accept an AIP even if it is no longer valid (as far as the lender is concerned) but still relatively recent? One of the many things I've learnt on this forum is that an AIP doesn't guarantee a mortgage will be offered or approved, so I assume the "freshness" of an AIP isn't key to persuading the EA that you're a serious buyer?