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Agreement in Principal?

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Does an AIP mean you are likely to be offered that particular mortgage when you make a full application? I am a little confused about what an agreement in principal really is!
LBM - January 2008 ~ debt - [strike]£16,260.00[/strike] £16,90.00 ~ Debt-free date - October 2016! :eek:
Official DFW Nerd Club Member No: 842 ~ Proud to be dealing with my debts!! :cool:

Comments

  • homer_j_3
    homer_j_3 Posts: 3,266 Forumite
    it just means that on the information provided they should be able to provide you with the loan.

    Unless its a binding decision, no agreement in pricipal will guarantee you a loan as lenders will normally want to see payslips, employers refs, bank stats and a survey before making a full offer of a mortgage.

    Its good to be accepted on AIP but not binding means lender can change their min should something come to light at a later stage which they are not happy with
    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.
  • NatashaP
    NatashaP Posts: 115 Forumite
    So, I take it they've already done a credit check on you before agreeing a mortgage in principal?
    LBM - January 2008 ~ debt - [strike]£16,260.00[/strike] £16,90.00 ~ Debt-free date - October 2016! :eek:
    Official DFW Nerd Club Member No: 842 ~ Proud to be dealing with my debts!! :cool:
  • JoeK_3
    JoeK_3 Posts: 1,374 Forumite
    Part of the application process is to conduct in depth credit checks and a valuation.

    Do you have any credit problems that you have not divulged on the AIP?

    JoeK
    I am an Independent Financial Adviser.
    Anything posted on this forum is for discussion purposes only. It should not be considered financial advice. Different people have different needs and what is right for one person may be different for another. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser who can advise you after finding out more about your situation.
  • NatashaP
    NatashaP Posts: 115 Forumite
    JoeK wrote: »
    Part of the application process is to conduct in depth credit checks and a valuation.

    Do you have any credit problems that you have not divulged on the AIP?

    JoeK

    We do have past credit probs which we were very honest about - our broker took all this, along with our earnings, performed a light credit check himself in order to find the most suitable lender then found a lender who have now given us this AIP (and I've checked with the broker a million times - defo an AIP done by the lender!)

    I was just a little confused as to what an AIP actually meant! If it formed part of the actual application process or was just a quick "yeah, we might lend to them" kind of thing, based on what we told them, without actually checking us out so to speak?!

    Thanks for the advice!
    LBM - January 2008 ~ debt - [strike]£16,260.00[/strike] £16,90.00 ~ Debt-free date - October 2016! :eek:
    Official DFW Nerd Club Member No: 842 ~ Proud to be dealing with my debts!! :cool:
  • NatashaP
    NatashaP Posts: 115 Forumite
    How often does an AIP actually lead to someone getting turned down when it comes to the actual mortgage application? I'd be gutted if that happens to us!
    LBM - January 2008 ~ debt - [strike]£16,260.00[/strike] £16,90.00 ~ Debt-free date - October 2016! :eek:
    Official DFW Nerd Club Member No: 842 ~ Proud to be dealing with my debts!! :cool:
  • homer_j_3
    homer_j_3 Posts: 3,266 Forumite
    It is more than likely a credit check will have been carried out. Providing there are no material changes from the information provided for the agreement in principal, there should not be any issues.
    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.
  • NatashaP
    NatashaP Posts: 115 Forumite
    Thanks! Hopefully we will be ok in that case - it was the credit check I was most worried about to be honest!
    LBM - January 2008 ~ debt - [strike]£16,260.00[/strike] £16,90.00 ~ Debt-free date - October 2016! :eek:
    Official DFW Nerd Club Member No: 842 ~ Proud to be dealing with my debts!! :cool:
  • terese
    terese Posts: 40 Forumite
    NatashaP wrote: »
    How often does an AIP actually lead to someone getting turned down when it comes to the actual mortgage application? I'd be gutted if that happens to us!


    I received an AIP with preferred mortgages in April and was promised faithfull by my broker that after that I will get an offer within 3 weeks. I made the full application and thought that there shouldn't be any problem at all because I supplied all the documents that they asked for. so I went down to dfs 2 weeks after to purchase my sofa which normally takes 12 weeks to arrive.

    My sofa is here and still no mortgage. 2 weeks ago preferred mortgages said that they can only lend me £12000 less than what i asked for.the underwriter took 4 months to come up with this. :confused:
    Asda card - £220, Halifax Card- £2200
    Halifax Loan - £3300, Capital Card - £500
    Total owing = £6220
    Debt Free on 01/10/2008 :j
  • Chimpfeet
    Chimpfeet Posts: 25 Forumite
    We have had an AIP for our remortgage. Its in the process of going to the underwriters. I keep asking our broker what the chances are of getting turned down (I'm really relying on getting it and everyday is a nightmare!!) also our mortgage processor person has gone on sick leave (how dare she when my life is in turmoil!!!!!!!!!) so someone else is now dealing with it. Today is Tuesday the broker said we should hear something by Friday and she seems to be positive but they can't give you a definite answer can they? Did you get your mortgage approved I notice your thread was posted last week??:eek:
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