Can You View a House Without a Mortgage Promise?

When starting the process of buying a house, many first-time buyers wonder if they can view properties without having a mortgage promise in place.

This insight aims to shed light on this common question and provide a thorough understanding of the role of the mortgage promise/mortgage agreements in principle (AIPs) in the home buying journey.

Key Takeaways

• Obtaining a mortgage agreement in principle (AIP) before viewing properties is highly recommended as it saves time, provides confidence in budget, avoids unnecessary broker introductions, and assesses mortgage feasibility.
• A mortgage promise gives home buyers peace of mind, narrows down property search, meets estate agent requirements, and increases the chances of faster offer acceptance.
• Estate agents may insist on a mortgage promise to ensure serious buyers with financial capability are granted access to viewings.
• While you can get a quick mortgage promise online, it's important to be aware of potential errors and limitations. Consulting with a mortgage adviser directly can be beneficial for complex financial situations.

Do You Need an Agreement in Principle Before Viewing Properties?

No, although obtaining a mortgage promise before viewing properties is recommended. It saves time, provides confidence in budget, avoids unnecessary broker introductions, assesses mortgage feasibility, and offers peace of mind and many estate agents require them, increasing the chances of faster offer acceptance.

Before going any further, it's crucial to clarify what a mortgage promise actually is. Also known as an agreement or decision in principle, it is a preliminary assessment from a mortgage lender based on limited financial information provided by the applicant. It gives an indication of how much the lender may be willing to lend to the borrower.

While there is no legal requirement to obtain a mortgage agreement in principle before viewing properties, it is highly recommended. Here's why:

Saving Time and Effort

Getting an AIP before viewing properties can save potential buyers a significant amount of time and effort. It helps them identify properties that are within their budget, avoiding disappointment and frustration later in the process.

Confidence in Budget

Having a mortgage agreement in principle gives buyers confidence in their budget. They can be certain that the amount stated in the AIP is the approximate loan amount they can secure, allowing them to focus on properties that align with their financial capabilities.

Avoiding Unnecessary Mortgage Broker Introductions

If buyers do not have an AIP, estate agents may try to introduce them to their preferred mortgage brokers. This can be time-consuming and may not align with the buyer's preferences. Obtaining an AIP directly from mortgage lenders online eliminates the need for unnecessary broker introductions.

Assessing Mortgage Feasibility

An AIP application process helps uncover any major issues that could hinder the mortgage approval process. It allows buyers to identify potential obstacles early on and seek appropriate solutions, increasing their chances of securing a mortgage successfully.

Can I Make an Offer Without a Mortgage in Principle?

Yes, you can make an offer on a property without a mortgage in principle. There is a legal obligation for the agent to pass your offer on. However, a seller may be reluctant to accept your offer without seeing proof of your mortgage finance.

Why Should You Get a Mortgage Promise?

Peace of Mind for Home Buyers

A mortgage agreement in principle provides peace of mind when buying a house. It assures them that they have been pre-approved for a mortgage, giving them confidence in their budget when searching for properties.

Narrowing Down Property Search

Having an AIP helps home buyers narrow down their property search to options within their budget. It prevents them from wasting time and effort on properties that are out of reach financially.

Estate Agent Requirements

Many estate agents now require prospective buyers to have an AIP before they allow them to view properties. This requirement helps weed out time-wasters and ensures that only serious buyers are given access to viewings.

Faster Offer Acceptance

When making an offer on a property, having a mortgage agreement in principle can expedite the process. Sellers are more likely to accept offers from buyers who already have a mortgage promise, as it demonstrates their financial readiness and increases the likelihood of a successful transaction.

Estate Agents Insisting On You Getting a Mortgage Promise

Estate agents may insist on potential buyers having a mortgage promise in place before allowing them to view a house. This requirement has become increasingly common in the industry. By asking for an AIP, estate agents aim to ensure that only serious buyers with the financial capability to proceed with a purchase are granted access to viewings.

Obtaining an AIP demonstrates your commitment and readiness to make an offer, which can increase your chances of securing a property in a competitive market. It also helps estate agents prioritise their time and resources by focusing on buyers who are more likely to proceed with a transaction.

However, it's important to note that while estate agents may request you to see their preferred mortgage adviser, you are under no obligation to do so. As a buyer, you have the freedom to choose your own mortgage adviser and seek advice from independent financial advisers. It's essential to be aware of your rights and options when it comes to selecting a mortgage lender.

Conducting thorough research, comparing rates and terms, and consulting with multiple advisers can help you make an informed decision that aligns with your financial goals and preferences. Remember, the ultimate decision regarding your mortgage lies with you, and you should feel empowered to make choices that best suit your needs.

Where Can You Get a Quick Mortgage Promise?

The quickest way to get a mortgage promise is online, but contacting a mortgage adviser over the phone can be just as fast and establishes the start of a mortgage relationship.

While obtaining a mortgage promise online can be convenient, there are several considerations. For example, the possibility of errors in the application process, as online forms may require accurate and detailed information. Inaccurately completing your Mortgage in Principle online could mean your Mortgage in principle isn't valid.

Additionally, some online systems may have limitations when it comes to considering complex financial situations or sources of income that do not fit standard criteria. It's important to carefully review the terms and conditions and ensure that the online platform you choose is capable of accommodating your unique circumstances.

If you have a more complex financial situation or require personalised advice, consulting with a mortgage adviser directly may be beneficial. They can provide guidance, assess your specific needs, and help navigate any potential challenges or unallowable income scenarios.

Next Steps

So, can you view a house without a mortgage promise? Yes, you can. However, there are several benefits to obtaining a mortgage promise and it prevents running into any issues with the estate agent. If you're unsure where to get started with obtaining a mortgage agreement in principle, complete the Sunny Fact Find. The answers you provide help us to find the best-suited adviser for your needs. Your adviser contacts you to discuss how they can help, you decide how to proceed.