What's an Agreement in Principle, and do you need one?

What it actually is

An Agreement in Principle (AIP, sometimes called a Decision in Principle) is a lender or broker saying, on paper, roughly how much they'd be willing to lend you. It's not the full mortgage, and it's not a guarantee, but it's a strong signal that you're a real buyer.

Estate agents ask for one because it tells them you can probably afford the place, so your offer gets taken more seriously than someone who's just browsing.

Does it hurt your credit score?

Usually not. Most AIPs use a "soft" credit check, which you can see but lenders can't, so it leaves no mark. It's worth checking it's a soft search before you go ahead, especially if you're applying to a few.

The hard check, the one that does leave a footprint, normally comes later when you apply for the actual mortgage.

When to get one

Get it just before you start seriously viewing, not months ahead. They typically last 30 to 90 days, and you want it valid when you find the place you want to offer on.

A broker can sort one quickly and, because they see many lenders, can point you at the ones most likely to actually say yes to your situation.

Common questions

Is an Agreement in Principle a guaranteed mortgage?

No. It's an indication of what a lender would likely offer based on a quick check. The full mortgage still depends on a complete application, the property valuation and a hard credit check.

Will getting an AIP damage my credit score?

Usually not, because most use a soft credit check that leaves no footprint. Check it's a soft search before proceeding, particularly if you're getting more than one.

How long does an Agreement in Principle last?

Typically 30 to 90 days. Time it so it's still valid when you're ready to make an offer, rather than getting one too early.