Why you should organise a Mortgage in Principle now

Why you should organise a Mortgage in Principle now

You may have read the headline to this article and be wondering why you might obtain a Mortgage in Principle now, rather than just go ahead and apply for an actual mortgage once you’ve found the property you want to buy. Well, the quick and simple answer is that a Mortgage in Principle gives you a clear indication of how much you can actually borrow, so you can then set about finding a property that fits into your budget. You may be surprised to discover just how many people find and fall in love with their dream home only to find out later down the line that they can’t actually afford it!   

So, a Mortgage in Principle can be a very useful thing to have when searching for a new home as it shows the estate agent that you’re a serious buyer and that any offer you make is a realistic one. Ultimately, already having a Mortgage in Principle in place puts you in a much stronger position when you finally find that dream home. 

So, what exactly is a Mortgage in Principle? 

There are several different types of Mortgage in Principle. A full Mortgage in Principle, also known as a Decision in Principle (DIP), is a written indication from a bank or building society (the lender) stating how much it might be prepared to lend you. It’s not binding as they could still refuse you a mortgage on those terms but it’s as close as you can get without physically applying for a full mortgage. The other type of Mortgage in Principle is one step removed from a full one – with Mortgagez you can obtain one of our Mortgage in Principles in under a minute. So, when you carry out a quick quote on the Mortgagez website, we are then able to provide you with what we refer to as the Mortgagez Mortgage in Principle. Based on the information you enter, our Mortgage in Principle will provide you with a summary of how much you could potentially borrow from a wide selection of different lenders. Then, once you’ve registered on our website, we’ll email you a copy of your Mortgagez Mortgage in Principle so you can use this as evidence of how much you could potentially borrow when speaking to agents and viewing properties. When you have found the property you want to buy, simply log back in to our website and progress your application with no need to re-enter your details. 

Do you need a Mortgage in Principle? 

Obtaining a Mortgage in Principle isn’t compulsory, but there are several good reasons for getting one: 

  1. A Mortgage in Principle gives you a clear idea of what you can afford, so you know your potential buying power and also your limits. Sometimes you can afford a better home than you think, while sometimes your ambitions will need scaling back a bit. 
  1. Some estate agents and/or sellers will only take your offer seriously if you have a Mortgage in Principle. This is especially the case if you’re buying in Scotland. Sometimes you won’t even get a viewing unless you have a Mortgage in Principle. 
  1. By showing you what you can realistically expect to borrow, a Mortgage in Principle reduces the risk that you’ll apply for a big mortgage that’s beyond your means and could then be rejected. A mortgage rejection can also be detrimental to your overall credit score and could make your next mortgage application even harder. A Mortgage in Principle application therefore tends to give you a ‘dry run’ with less risk attached (although you should be aware that depending on the lender sometimes a credit check is carried out against the individuals applying for the the mortgage). 


When you should you get your Mortgage in Principle? 

As soon as you’ve made up your mind to start home-hunting seriously, you should apply for a Mortgage in Principle. Aside from its practical uses, this will help you to focus on your task and commit to it. Knowing what you can afford, even just in theory, delivers a huge confidence boost. 

Having a Mortgage in Principle can also save time in the buying process, both in terms of getting your offer accepted and also speeding up the mortgage application process. Mortgagez will provide you with a copy of our Mortgage in Principle once you have registered with us and some lenders will give you a certificate when they offer a mortgage in principle, which can be useful to show to estate agents. 

Use our mortgage calculator (Mortgagez | Instant Online Mortgage Calculator) to find out how much you can borrow, how much it’ll cost you per month and what your loan to value ratio will be.

How long does a mortgage in principle last? 

A mortgage in principle generally lasts between 60 and 90 days, depending on the lender. If you haven’t found a property or had an offer accepted in that time, you may need to get another. Renewing it should be fairly straightforward unless your circumstances have significantly changed. Please bear in mind any mortgage deal you find on the Mortgagez website via our quick quote tool will not be secured until you progress your application with us as mortgage deals can be removed by lenders at any time. 

Here at Mortgagez, our team of fully qualified mortgage advisers is on hand to help you every step of the way in obtaining a new mortgage and our service won’t cost you a penny when you go via our online portal. Visit our website today and obtain a quick quote to see how much you could save on your next mortgage. 

PLEASE NOTE: Article written 26th April 2021. Information contained within this article is likely to change and therefore should not be relied upon or form part of any form of decision making without seeking professional advice. * 


Any guidance and/or advice contained within this document is subject to the UK regulatory regime and is therefore restricted to consumers based in the UK. Any technical or regulatory information contained within this document was correct at the time of producing it but as it may be subject to change it should not be exclusively relied upon when making a financial decision. The Financial Conduct Authority does not regulate advice on Buy to Let mortgages.  

Article written: April 2021                                                                                                            060121 MZ000191

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