What Is an Agreement in Principle? Complete AIP Guide 2026

What Is an Agreement in Principle?

You've found a house you like. You ring the estate agent with your offer, and the first thing they ask back is: "Have you got an agreement in principle?"

If the answer is no, many agents won't take your offer seriously. So it's worth sorting one out before you start viewing.

An agreement in principle, or AIP, is a lender saying roughly how much they'd be willing to lend you, based on what you've told them about your income and outgoings, plus a look at your credit file. You'll also hear it called a decision in principle (DIP) or a mortgage in principle (MIP). Same thing, different lenders.

It is not a mortgage offer. Nobody has valued the house yet, and nobody has gone through your payslips and bank statements properly. It's the lender saying you look fine on paper. Useful, but not a promise.

AIP vs Mortgage Offer: What's the Difference?

People mix these two up all the time. It matters, because one is a rough guide and the other is the real thing.

Do You Need an Agreement in Principle?

Legally, no. In practice, yes, if you're buying with a mortgage.

Three reasons. First, the estate agent. Most will want to see one before they put your offer to the seller, and if two people offer the same price, the one with an AIP looks the safer bet.

Second, your budget. It's easy to fall for a house you can't actually borrow enough for. Finding that out after you've made the offer is a horrible feeling.

Third, it flags problems early. If something on your credit file is going to cause trouble, you want to know now, not three weeks after your offer has been accepted.

The only people who really don't need one are cash buyers.

How to Get an Agreement in Principle

You can go to a bank or building society yourself, or ask a mortgage broker to do it for you. Either way, you'll be asked for:

• Your income, and how you're paid (employed, self-employed, contractor)
• Your regular outgoings and any credit you're paying off, such as cards, loans or car finance
• Roughly how much you want to borrow and how much deposit you have
• Your address history, so they can search your credit file

You usually don't need to send payslips or bank statements at this stage, although a few lenders ask for them. Online, you can often get an answer in minutes.

Soft or Hard Credit Search? Ask Before You Apply

This is the bit most guides skip, and it's the one that can cost you.

Most lenders run a soft search for an AIP. Only you can see it, and it doesn't affect your credit score. A few lenders still run a hard search, which other lenders can see on your file.

One hard search won't do much harm. Several in a few weeks can make the next lender wonder why you're applying everywhere. So if you're shopping around, ask each lender, or your broker, which kind of search they use before you press submit.

What Does an AIP Actually Contain?

Usually not much. Most show:

• Your name, and your partner's if it's a joint application
• The amount the lender would consider, for example "up to £250,000"
• How long it's valid for
• A reference number

What it won't show is an interest rate. You pick the actual mortgage deal later, once you've found a property.

How Much Confidence Should You Put in an AIP?

Some, but not too much. An AIP is based on what you told the lender. The full application checks all of it.

When a case does fall over after an AIP, it's usually one of these:

• Your payslips or bank statements don't match what went on the AIP. Overtime and bonuses are the usual culprits, because many lenders only count part of them
• The full credit search turns up something the AIP didn't
• Your circumstances change: a new job, new car finance, a missed payment
• The property is valued at less than you agreed to pay, so the lender will lend less
• The AIP ran out and the lender changed its rules in the meantime

AIPs and Property Searches: The Timeline

Every purchase is different, so treat this as the usual order rather than a set number of weeks.

1. Get your AIP. Before you start viewing, so you know your budget.
2. Find the house and make an offer. The agent will usually ask to see your AIP.
3. Offer accepted. Now the full application goes in. Often it's with the same lender, but it doesn't have to be.
4. Documents and valuation. The lender checks your payslips and bank statements and values the property.
5. Mortgage offer. Often two to four weeks after the full application, sometimes quicker.
6. Legal work, exchange and completion. Your solicitor or conveyancer takes it from here. Our mortgage application guide covers this stage.

If your AIP runs out while you're still looking, ask for a new one. With most lenders that's quick.

Multiple AIPs: Should You Apply With More Than One Lender?

You can, as long as they use soft searches. Two or three AIPs with different lenders is fine.

The full mortgage application is different. That involves a hard search, so only make one once you've picked your lender and found your property. Several full applications close together can put the next lender off.

A broker gets round most of this, because they know which lenders are likely to say yes before your details go anywhere.

Using a Mortgage Broker vs Applying Direct

Going direct

Quick and simple if you already bank with someone and your situation is straightforward. The catch is you only see that one lender's deals and that one lender's rules.

Using a broker

A broker can compare lenders for you and knows which ones are likely to accept your case before you apply. That matters most if anything about you is a bit different: self-employed, bonus or overtime, a small deposit, or a blip on your credit file.

Brokers are paid a commission by the lender. Some also charge you a fee, so ask what you'll pay before you start.

What to Do When You've Got Your AIP

• Don't treat the figure as a target. If a lender says up to £300,000, that's the most they'd consider, not what you can comfortably afford each month.
• Budget for the extras. The AIP only covers the mortgage. You'll also need money for stamp duty if it applies, legal fees, a survey and moving costs.
• Keep a copy handy. The estate agent will usually want to see it when you make an offer.
• Watch the date. Most last 30 to 90 days. If yours is running out, ask for a new one.
• Keep things steady. No new credit, and no job change if you can avoid it, until the mortgage completes.

From AIP to Mortgage Offer: What Happens Next

Once your offer on a house is accepted, you make the full mortgage application. This time the lender:

• Asks for proof of income, usually recent payslips (or accounts or tax calculations if you're self-employed) and bank statements
• Runs a hard credit search
• Values the property
• Checks your affordability again in full

If it all checks out, you get a mortgage offer. It's usually valid for three to six months, and the lender will stand by it unless your circumstances change or something you told them turns out to be wrong. You don't have to accept it if you change your mind.

Common AIP Questions Answered

Does an AIP affect my credit score?

With most lenders, no, because they use a soft search. A few use a hard search, which other lenders can see. Ask before you apply.

How long is an AIP valid for?

Usually 30 to 90 days. It's shown on the certificate. If it runs out, you can normally get a new one.

Can my AIP be withdrawn?

Yes, it isn't binding. If your circumstances change, or the full checks don't match what you told the lender, they can say no or offer less.

Do I have to use the same lender for the full mortgage?

No. Plenty of people get an AIP with one lender and end up applying with another.

What if I'm turned down after getting an AIP?

It happens. Don't rush to apply somewhere else. Find out why first, then fix it or find a lender who's a better fit. Our guide on what to do if your mortgage application is declined walks you through it.

The Short Version

• An AIP tells you roughly what a lender might lend. It isn't a mortgage offer.
• Get one before you start viewing. Agents will ask for it.
• Ask whether it's a soft or hard search before you apply.
• Keep your finances steady until the mortgage completes.