A mortgage in principle is the document that an estate agent or any seller is going to request when you make an offer on a property if you intend to buy with a mortgage. It is a simple document that a lender issues upon submitting the relevant informaiton about yourself, your financial situation and the type of property you intend to buy. 
There is nothing stopping you making an offer on a property but until you can provide the agent/seller with this document they won’t accept your offer. 
The one-page document is sufficient evidence from a lender that shows you have a mortgage lined up. The document will show: 
• Your name 
• The amount they will lend you 
• The lenders name 
So how do you get one? 
Best advice is to use an independent adviser who can search the wider market to find not only the cheapest lender but the lender who is most likely to accept you when it comes to submitting a full application. They will review your financial position and future plans and use their expert knowledge to find the lender that’s the best fit for your needs. 
They will then approach that lender and provide them with some basic information about you and the lender will review this and run a quick credit check on you to make an initial decision. More times than not the decision is instant, and they will issue the mortgage in principle certificate on the spot. Your adviser will forward this to you to allow you to make an offer on a property. 
Its vitally important that you and your adviser are as accurate about your information as possible because that information must match up with the documental evidence you will provide on the application. If the information is incorrect the application may be declined, so you must be honest and accurate. 
When is best to get a mortgage in principle? 
As soon as possible is the short answer! Best practice is to have your mortgage in principle in hand before you even start to view properties, and heres a few reasons why… 
How do you know how much you can afford to borrow? – If you havent secured a mortgage in principle yet, how do you know what properties are in your budget? 
Having a mortgage in principle on paper is great, but what do the monthly payments look like on a mortgage of that size? Its OK being approved for a £400,000 mortgage but if your budget is £2,000 a month and the monthly payments are £3,000 a month then those sorts of properties are out of the question for you. 
Efficiency – If you have a mortgage in principle already as soon as you find the property you like you can make an offer right away. If you find a property and then need to secure a mortgage in principle, in the time that takes another buyer may come along and buy the property before you have a chance. 
By having your mortgage in principle before you look you know how much you afford to borrow, what that looks like in real terms and are armed with the one document you need to have your offer confirmed and accepted. 
So, if you are looking to buy your next home get your mortgage in principle in place today! 
If you would like us to help with this please give us a call on 01482 205084 or email info@greenandgreen.net 
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