Credit search for aip + other questions.

anticlaus105

I have an appointment booked with ybs. I was told for an aip a credit search would be required. Is this the case for all lenders?

What if I get an aip but it takes a few months to find somewhere, and in the meantime a better deal springs up elsewhere?

Also does the aip have to be for a specific mortgage type/rate or will the final rate depend on the property value vs mortgage eventually required?

And is the ltv based on what you pay or the survey value (or possibly whichever is lower)?

Does it show that I'm new to all this ?

libf

You shouldn't be getting an AIP unless you plan to apply for a mortgage with that lender within 3 months. Instead you can try using their affordability calculator to see how much you could borrow.

LTV is based on what you agree when buying the property, but the valuation has to back that up.

Malmo

Replies in bold...

anticlaus105 wrote: »

I have an appointment booked with ybs. I was told for an aip a credit search would be required. Is this the case for all lenders?

All lenders will credit search you but the distinction is around whether or not they automatically score you. A small handful of lenders don't automatically score applicants but still review your credit profile history.

What if I get an aip but it takes a few months to find somewhere, and in the meantime a better deal springs up elsewhere?

Also does the aip have to be for a specific mortgage type/rate or will the final rate depend on the property value vs mortgage eventually required?

The purpose of the AIP isn't to specify which product and rate you are eligible for. It validates your creditworthiness and based on that, indicates your maximum borrowing power subject to further affordability and other criteria.

And is the ltv based on what you pay or the survey value (or possibly whichever is lower)?

Based on the lower of the purchase price or valuation.

Does it show that I'm new to all this ?

amnblog

anticlaus105 wrote: »

Does it show that I'm new to all this ?

It shows that you should be getting some proper independent advice - not going direct to lender.

anticlaus105

Thanks for the replies.

I did speak to a mortgage broker some friends had used but he didn't fill me with confidence. I will try some more and use my own findings as a benchmark.

The idea of an aip was to appear serious to ea's when making offers. I have read many will ask to see one (I will obviously show a redacted version should it give anything away).

If I go through a broker can I get something like an aip but not be tied to a specific lender? If for example we view several properties and it comes down to 2. One would be 75% ltv and another 65%. There may be 2 different companies mortgages that are best for these 2 different ltv's. With an aip I may have gone down the road with the wrong one.

We have got our statutory credit reports. Ybs said this didn't matter as for aip a credit search would be required.

Malmo

Replies in bold...

anticlaus105 wrote: »

Thanks for the replies.

I did speak to a mortgage broker some friends had used but he didn't fill me with confidence. I will try some more and use my own findings as a benchmark.

The idea of an aip was to appear serious to ea's when making offers. I have read many will ask to see one (I will obviously show a redacted version should it give anything away).

Yes, Estate Agents and vendors will normally want to be assured that you have an AIP, whether by seeing one directly or by being informed by your broker or potential lender. But the process by which an AIP is obtained still requires a credit search, unless you happen to get one of those bits of paper from London & Country brokers which is based only on what you tell them and not a credit search, hence being of questionable value

If I go through a broker can I get something like an aip but not be tied to a specific lender? If for example we view several properties and it comes down to 2. One would be 75% ltv and another 65%. There may be 2 different companies mortgages that are best for these 2 different ltv's. With an aip I may have gone down the road with the wrong one.

See comment about London & Country...conventionally, an AIP is tied to a lender. Why not go with a lender (whether direct or via broker) that will lend you the maximum that you think you need?

We have got our statutory credit reports. Ybs said this didn't matter as for aip a credit search would be required.

A confusing statement from YBS. They will search your credit profile history with whichever credit reference agency they currently do business with (looks like Equifax according to this post)