Mortgage in principle

rococomaiden

We are first time buyers and have hit a snag with the mortgage in principle.

We are using a mortgage broker (who is a friend of the family so their is no charge). They asked for all our documents and confirmed the amount we could borrow. It was my SO who was dealing with him and he was under the impression he had received the mortgage in principle.

As it turns out due to some sort of miscommunication the application was not submitted. Also I understand that the mortgage in principle is a physical document we should receive (is this true?).

We told the estate agents that we already had a mortgage in principle when we had our offer accepted, and they won't remove the house from the market until they see one.

The main issue is that the mortgage broker is now on holiday until Tuesday... so can't submit until then..

We are not worried that we won't get the mortgage as the amount is 55k lower than the broker said we could go.

We have already arranged a survey and instructed our solicitor, but I'm now panicking that we could get gazumped over the weekend.

Is it worth getting the agreement in principle directly from the bank? I know the rates won't be as good, but I wonder if we could later go through the broker to get the lower rates? Would the broker get a same-day confirmation from the bank if we wait until Tuesday?

Is it worth begging the estate agents, saying that we have paid for a survey to show our commitment?

I know in hindsight I should have asked to see the agreement in principle when my SO said we had it (!)

hazyjo

Surely you're ahead of that now and should be applying for the actual mortgage? Or is that what you mean?

Have you paid for searches yet? That's usually enough to show commitment.

What sort of survey are you having? If homebuyer's, I'd usually be arranging that through the lender (done at the same time as the valuation, usually resulting in a lower price).

I've never had an AIP/MIP - but did get my lender to once confirm to an EA that I was 'good for the money'. Didn't tell them what the max was that they would lend me.

rococomaiden

We are waiting on applying for the actual mortgage since the survey does not take place until next month and we would want to see the survey first.

Again it might be our first time buyer ignorance, but would you be able to "back out" after you have applied for the actual mortgage?

We are having a full building survey rather than a homebuyers survey (since it's an old house).

steampowered

rococomaiden wrote: »

We have already arranged a survey and instructed our solicitor, but I'm now panicking that we could get gazumped over the weekend.

You can get gazumped at any point until exchange.

The agent is obliged to pass on any offers to the seller, who can choose to accept them. Providing your AIP/MIP won't stop you from getting gazumped I'm afraid.

You should just wait until your broker gets back from holiday next week, and let the estate agents know what is happening.

Catkei

If you just want something to show you are "good for the money" you can do a quick AIP with Halifax which is as far as I know a soft check so won't affect your credit rating. You just get emailed a confirmation you can print out.

rococomaiden

That might be a good work-around! Thanks!

kingstreet

You've demonstrated to the EA you are prepared to spend hundreds on a building survey and they are insistent on seeing a piece of paper that says "agreement in principle?"

An AIP can be obtained with complete lies with absolutely nothing to back it up.

I despair at the lack of common sense in this world, I really do.

novelty-socks

The AIP from our broker was an emailed Word document that I could have edited to show any amount I liked. (The agents round my way were pretty relaxed on this point, and were happy enough to take the flat off the market when I told them that our mortgage application was going in.)

Like other posters have said, I wouldn't worry about this too much. You can get gazumped anyway.

todayisagreatday

I'd speak to another broker such as L&C or similar......