Do you know your AIP (Agreement in Principle) from your DIP (Decision in Principle) and your MIP (Mortgage in Principle)? As confusing as it is, there isn’t any difference at all!
The key word here is “principle”. Everyone in the mortgage industry uses their own preferred term but they all mean the same thing, they provide assurance that you’re eligible for a mortgage and an indication of how much you could borrow towards a property purchase.
Who needs a DIP?
Whether you’re a first time buyer (FTB) or moving home, if you’re looking to purchase a property with a mortgage, this will allow you to be confident in offering on a property and allow you to form a budget of what you could afford.
Offering on a property
In order for your offer to be accepted when purchasing a property, an estate agent will require a copy of your DiP as reassurance that you can reliably complete the purchase of the property. After your initial meeting, your mortgage broker will be able to provide you with an DiP quickly so feel free to give us a call when you’re ready to make an offer and we’ll be ready to provide this to you the same day.
How long does a DiP last?
They’re usually valid for between 30 and 90 days dependign on the mortgage lender. Try to avoid changing jobs or taking out new credit while applying for a mortgage in order to reduce the risk of being declined for your mortgage application.
Will it effect my credit score?
Some lenders will conduct a “hard” search at DiP stage which will negatively impact your credit score for a period. In most cases we will select a lender that conducts a “soft” search at DiP stage in case the intended purchase doesn’t go ahead. Once your offer is accepted we will then look at who the best lender would be to go ahead with for your mortgage application.
How to get a DiP
Getting a DiP is quick and easy- it’s completely free and there’s no obligation to proceed so get in touch with one of our expert advisers:
*All information up to date at time of writing, speak to your advisor for specific advice for your own circumstances.
