Active discussions

Meet the Other Phone. A phone that grows with your child.

Meet the Other Phone.
A phone that grows with your child.

Buy now

Please or to access all these features

Talk
Property/DIY

Join our Property forum for renovation, DIY, and house selling advice.

Original poster

Does a 'mortgage in principle' mean you will get the mortgage??

26 replies

MoveAlongNow · 14/04/2015 21:07

Just that really. Been offered a mortgage in principle (think that's what its called!), but could we still be refused a mortgage at a later date? Stressed about this whole business, any replies very gratefully received.

OP posts:
Original poster
MoveAlongNow · 14/04/2015 21:22

Anyone??

OP posts:
MaraThonbar · 14/04/2015 21:23

Not necessarily - it's only confirmed once you get the formal mortgage offer. The bank will use a surveyor to value the house and confirm that your agreed price is reasonable, as well as carrying out other checks.

We have found using a broker to be reassuring; as they work on commission I reason that they will only recommend products that you're likely to be approved for, but I'm happy to be corrected on this.

Good luck.

Original poster
MoveAlongNow · 14/04/2015 21:27

Thank you Mara!! So the broker will have already been satisfied that credit checks are satisfactory to have issed the mortgage in principle?

If you say yes I may be able to stop fretting...

OP posts:
fulltothebrim · 14/04/2015 21:27

It doesn't mean that you will get the mortgage- no.
There still has to be lots of work done- affordability checks which can be a nightmare- details credit checks etc.
Unfortunately you won't know the actual outcome until you apply.
Gather as much info as you can before you actualy apply, have a look at your own credit scores etn, and start gathering financial document- it will same you time and stress later down the line.

It won't be in until the fat lady sings I'm afraid, and for some that may mean pulling out of deals. It does happen.

AbbeyRoadCrossing · 14/04/2015 21:28

It's a good thing to have as vendors can see you're serious and have looked into it. It depends...usually yes. But if your circumstances change, they don't value the house at the price you're paying, or the mortgage market changes for example they could say no. We used a broker, it cost us money but as first time buyers we didn't feel we could risk a decline on our record.

Original poster
MoveAlongNow · 14/04/2015 21:28

Or if anyone else wants to come on here and agree with Mara stroke my head and tell me it will all be ok that would be good too Grin

OP posts:
fulltothebrim · 14/04/2015 21:28

You need to do your own credit checks to see the information that lenders will be looking at. Contact Experian to see a copy.

morethanpotatoprints · 14/04/2015 21:29

If all the requirements set out are made and the house is valued/ surveyed and the pricing correct, you will be offered the mortgage.
This usually states how long the offer is available for.
Good luck.

Original poster
MoveAlongNow · 14/04/2015 21:30

X-post and stress levels back up Sad it's the not knowing that I find hard.

OP posts:
Original poster
MoveAlongNow · 14/04/2015 21:33

Thank you all. It's already a very stressful process and I've only started! Maybe buying a van and living on the road would be a less stressful option?? Joking. Kind of.

Morethan - is valuation performed as soon as you have an offer accepted?

Thanks again

OP posts:
LMGTFY · 14/04/2015 21:36

I have a 'Mortgage in Principle', mortgage advisor did the credit check when I was there, to actually go ahead I'll need to complete their 'budget planner' with what we'll be paying (in the new house) which I assume to be the new affordability thing as well as having a home buyers survey on the house to show it is what they can sell it for if I default it is worth.

AbbeyRoadCrossing · 14/04/2015 21:37

Have you found a house and had the survey done? I'm afraid it will always be a not knowing situation until you get further down the line. If for example, you made an offer on a massively overpriced house that was about to fall down the bank would probably say no. It's all about the chances of them getting their money back.

Eminybob · 14/04/2015 21:38

In order to provide a dip, the lender should have completed affordability and credit checks. Provided that all the information you provided is accurate, and you have the relevant proofs, then yes it means your mortgage will be approved subject to a valuation of the property you are buying.

fulltothebrim · 14/04/2015 21:44

In order to provide a dip, the lender should have completed affordability and credit checks.

That wasn't our experience and we bought 6 months ago.
THis was done after we found a house we wanted to buy. The lender would not commit to doing the application process until we were ready to buy.

Original poster
MoveAlongNow · 14/04/2015 21:48

Abbey - no survey yet, haven't seen anything seriously yet really. Just looking to see what sort of mortgage we can get. Feel convinced it will all go wrong Sad but that could just be due my emotional state at the mo. Hard to separate emotions from finance for some reason!! DP totally blase, what will be will be mindset, but I'm getting worked up over it all for some reason.

OP posts:
Eminybob · 14/04/2015 21:55

I work for one of the biggest lenders in the country and although you can't see a mortgage adviser and complete an application until you have found a house, you can get a decision in principal in branch, on line or on the phone which will do affordability and credit checks, subject to the info you provide. Obviously that info then gets checked to confirm accuracy upon application.

I thought that was pretty standard. I wouldn't want to put an offer in on a house until I have had a dip done.

Original poster
MoveAlongNow · 14/04/2015 21:55

Fulltothebrim - did you not get a mortgage in principle then?

OP posts:
fulltothebrim · 14/04/2015 21:55

I do sympathise. I too find these things very stressful.
Do as much research as you can. You will feel more confident with more information. If you know you have a big enough deposit /cost ratio that is a huge plus. If you are young and years away from retirement age - again a plus. If you can comfortably afford the repayments on your salary- that is in your favour.
If you have low debt and a good credit history then that's great too.
If all thinks stack up well you have a good chance of being offered. If you are refused you can try anothet lender.
Find out waht lenders are looking for, do your own research.
We found a better deal than the one our broker could find, have a look at moneysavingexpert.com for more info generally about mortgages.

Original poster
MoveAlongNow · 14/04/2015 22:01

Thank you fulltothebrim that is reassuring. I've always found application processes a bit daunting, this one many times more so!!!

nd thank you eminybob for your professional perspective

OP posts:
fulltothebrim · 14/04/2015 22:02

Obviously that info then gets checked to confirm accuracy upon application.

We found that the stumbling block- but then we applied last summer when these new affordability checks were quite recent.

We were offered a mortgage in principle- went ahead with the application and the mortgage was declined. We appealed against the decision, and we won the appeal. We decided on that route rather than looking for another lender as things were time critical. Still a very hairy few weeks.

Luciferbox · 14/04/2015 22:03

I'm in the middle of this. We've used a broker and lay out everything and he worked around that as my DH doesn't have an amazing credit history. He found a mortgage he thought would fit, 2 weeks later and we've been approved. The bank will value the property in a few days and we hope to hear back at the start of next week. I'm a first time buyer and have been worried it wouldn't go through but I have been reassured by the fact he's on commission. It's in his interest to get it right.

stardusty5 · 14/04/2015 22:05

A Mortgage in principle is fairly easy to sort out and will take into account your affordability and credit score.

We've just gone through this process, and it was made much easier by the fact that we weren't trying to borrow to absolute maximum that was deemed affordable for us. I realise that in some areas of the country though, you won't have much choice but to go for as much as you can. The larger the percentage of your income that goes on mortgage and other essentials such as existing debts, the more scrutiny you will be under.

We used a broker for advice, but the best deal for us was actually through our own bank so we didn't apply via the broker in the end. Their advice was very useful though.

The full application will go into your outgoings and will also consider how you would cope of interest rates rise. It will also consoder which is the best product for you in terms of length and flexibility. Once you have your offer, its then subject to a satisfactory valuation to check you are not iverpaying for the property.

Original poster
MoveAlongNow · 14/04/2015 22:08

Lucifer - that is good to hear, thank you. We are facing similar issues really

OP posts:
ZestyDragon · 14/04/2015 22:52

We have just been through this. We used a broker and were told pretty quickly that we had a mortgage in principle but it took a further two weeks of more detailed assessment before they officially approved us. The survey is being carried out this week and hopefully the offer will be on its way. Using a broker was actually the best way for us as they lender wasn't happy with my payslips (hand written) even though I had official P60, salary going into bank etc.

We found the property before applying for the mortgage but we met with the broker before we started looking so that he could tell us what we needed.

louisa87 · 17/09/2017 17:57

So we are going to a meeting with the mortgage adviser to get a mortgage in principle. As it stands im on 19,400 a year but have been told this will go up from Jan 2018 to 21,000. I had a letter done by my employer to show them. will they need to contact my employer or will this just be from the actual application stage of the mortgage when we have found somewhere?

Swipe left for the next trending thread