London and Country DIP not accepted by EAs

NiceDream

Hi everyone,
I've had two estate agents say that my London and Country decision in principle is not sufficient because it's not a "real decision in principle".
Anyone else have this experience? The first time it happened I thought the EA was just trying to get me to use their broker service but now it's happened again I'm wondering if this is a real issue or definitely an EA tactic.
thanks in advance!

hazyjo

Sufficient for what? Are you trying to make an offer, or just view? Perhaps they're more familiar with the term Agreement In Principle? Same thing, but I suppose the pedantic may say Decision sounds somewhat more official like you've actually applied for the mortgage.

kinger101

It's not a real DIP in that London and Country are not lenders. While no DIP is particularly meaningful as they're not binding (and have often been provided without any checks on affordability), a vague assertion that a near-stranger is eligible to borrow a large amount of someone else's money is pretty worthless IMO.

But given all DIPs are fairly meaningless non-promises, it might be a tactic by the EA. So either see their broker, or get a DIP from a lender. It probably only takes a few minutes from one that does a soft-search.

DCFC79

Why not see the broker at the EA, you might find they have access to more lenders.

ACG

Its not a DIP as no credit check has taken place, it is an affordability calculation at best.

[Deleted User]

You could borrow £x but under certain circumstances you might be able to borrow £y.

Its not a real Dip. As bad as some practices from Estate Agents are, they are correct in what they say at this point.

If you really want to stick with them, tell L&C you need an actual agreement from a named lender.....or speak to a proper broker

kingstreet

Presumably L&C lose so much business between initial enquiry and application to EAs and other brokers doing a full DIP in the early stages isn't cost-effective.

They do only affordability checks and pretty much everyone in the industry is aware of that.

NiceDream

Thanks everyone for the responses - I'm glad to hear it's all legit and not just an EA tactic.

[Deleted User]

They aren't mutually exclusive.

It is legit that you don't have a Dip. But it is definitely a tactic to make you feel you need to see their advisor.

By all means meet with the advisor, I know and have known many many good brokers working in estate agents. Some independent, some not. But don't feel you are being forced in to anything.

steampowered

The EAs I dealt with accepted a L&C DIP.

You could simply refuse. A lender MIP doesn't involve the full set of checks for a mortgage offer so it's hardly any different to L&C's decision in principle.

That said, the path of least resistance might be to simply get a DIP from a random lender. It only takes 10 minutes.

letitbe90

kinger101 wrote: »

While no DIP is particularly meaningful as they're not binding (and have often been provided without any checks on affordability), a vague assertion that a near-stranger is eligible to borrow a large amount of someone else's money is pretty worthless IMO.

But given all DIPs are fairly meaningless non-promises, it might be a tactic by the EA. So either see their broker, or get a DIP from a lender. It probably only takes a few minutes from one that does a soft-search.

This is incorrect, lender DIP's do take affordability (and a soft credit check) when giving them. I would estimate in 95%+ cases that providing the property is sound, you will get the same loan amount as the DIP. The hard check might uncover in some cases some really old data but we are talking edge cases. Unless you told lies on the application, it would be the exception not the norm, not to be able to get the loan amount offered.

That is of course true only for lender DIP's, L&C and others are actually meaningless.

(I say this from actual experience of bank processes not just anecdotes or my opinion).