Agreement in Principle: everything you need to know

An Agreement in Principle (often called a mortgage in principle, decision in principle, or approval in principle) is a document from a lender that gives an indication of how much you may be able to borrow for a mortgage.

It’s designed to help you understand your likely borrowing range early in the buying process, and it can show estate agents and sellers that you’re a serious buyer.

An Agreement in Principle is not a mortgage offer. It’s based on information provided at the start of the process, and it doesn’t replace the full affordability checks and property assessment that happen later.

What an Agreement in Principle is used for

For first-time buyers and home movers, an AIP can help in practical ways:

Budgeting with clarity: you can estimate the likely mortgage size and plan around it.
Making stronger offers: sellers may prefer buyers who already have an indication of mortgage funding.
Reducing delays after an offer is accepted: if your circumstances haven’t changed, moving from AIP to full application can be smoother.

In competitive areas, having an AIP can make your offer feel more “ready to proceed”, particularly when there are other buyers in the chain.

AIP vs full mortgage offer

A full mortgage offer is the formal stage that follows detailed checks (including the property and supporting documentation).

An AIP typically sits earlier in the process and focuses on:

Your affordability based on the details you submit
The type of mortgage you’re seeking (for example, repayment or interest-only)
Whether the lender’s criteria appear to be met at that point in time

Because it’s based on initial information, an AIP can change as your application progresses, especially if your circumstances or the property details differ.

For more on the later stage, see What is a mortgage offer? and Key Facts Illustration (KFI) and ESIS.

How to get an Agreement in Principle

You can usually apply for an Agreement in Principle through a lender or via a mortgage adviser/broker. The process typically involves providing key personal and financial information.

While the exact steps vary, you’ll generally be asked to confirm details such as:

Your identity details (for example name, date of birth, and current address)
Address history (often covering a set period)
Your income
Your monthly outgoings and existing financial commitments
Deposit information and how you plan to fund it
Property details (sometimes later in the process, depending on the lender)
Residency information

Once submitted, the lender will review the information and provide a written indication of the borrowing amount they may be willing to consider.

How an Agreement in Principle works (step by step)

Although processes vary, the general approach is similar:

You submit basic financial details This usually includes your income and regular commitments, along with information about the borrowing you’re looking for.
The lender performs an initial assessment The lender estimates how much they may be willing to lend based on the information provided.
A credit check may be carried out Some lenders use a soft credit check for early decisions, while others may use a hard search. The type of check can affect how your credit file is recorded.
You receive a decision document If successful, you’ll typically receive confirmation of the provisional maximum borrowing amount.

Most Agreement in Principle applications focus on information, rather than full documentation. However, you should expect to be asked for details that allow the lender to assess affordability.

If you’re self-employed, have multiple income streams, or your income varies, you may be asked for additional detail to help the lender understand how stable it is.

Because the AIP is only as good as the inputs, it’s important that details are up to date and consistent with what you can evidence later.

For more on how lenders may assess different types of work, see mortgages for actors and mortgages for contractors.

When to apply for an Agreement in Principle

An Agreement in Principle is most useful when it fits your buying timeline.

Consider applying:

When you’re actively searching and likely to make an offer soon
After you’ve reviewed your finances and deposit position
Before you commit to a purchase so you can plan around likely borrowing

If you’re not yet sure when you’ll be ready to offer, it can help to align the AIP timing with the point at which you expect to start viewing properties seriously.

How long does an Agreement in Principle last?

An Agreement in Principle is usually valid for a limited period, commonly between 30 and 90 days, depending on the lender.

A practical approach is to apply when you’re ready to start making offers, rather than too far in advance, so you’re less likely to need to repeat the process if it expires.

If it expires before you complete the next stage of the buying process, you may need to renew it. Keeping an eye on timing can help avoid delays when you’re ready to move forward.

Does an Agreement in Principle affect your credit score?

In many cases, applying for a mortgage in principle involves a credit check.

Whether it affects your credit file can depend on the type of check used:

A hard search can leave a visible footprint on your credit record and may affect your credit rating
A soft search is typically not visible to other lenders in the same way

Because different lenders and processes can use different types of checks, it’s worth being mindful if you’re applying for multiple agreements in principle around the same time.

If there are several hard searches in a short period, it may make your credit profile look more “active” than usual. That doesn’t automatically mean you’ll be declined later, but it can be a factor worth managing.

To keep things as smooth as possible:

Ensure the information you provide is accurate
Avoid making major financial changes during the application window
Be mindful of applying repeatedly if you’re not ready to move forward

Review your credit report before applying and check that the details are accurate. See Credit reports and mortgage applications for more detail.

Can you be rejected after getting an Agreement in Principle?

Yes. An Agreement in Principle is not a guarantee.

At the Agreement in Principle stage, the lender’s view is based on a relatively high-level assessment of affordability and the information you’ve provided.

Later, when you apply for the full mortgage, the lender will typically carry out more detailed checks, including:

A fuller affordability assessment
Verification of income and commitments
A property valuation and suitability checks
Consideration of the specific mortgage criteria for the property and borrower

If anything doesn’t meet the lender’s requirements at the full application stage, the outcome can change.

Potential reasons include:

Changes in your circumstances (for example, a new job, reduced income, or increased spending)
Credit information changes between the AIP stage and full application
Property-related factors discovered later (such as valuation outcomes)
Differences between what was declared and what is evidenced

For that reason, it’s sensible to treat an AIP as a helpful starting point, not a guarantee of the final mortgage terms.

For next steps if you are declined, read What to do if your mortgage is declined after AIP.

How reliable is it for budgeting and making an offer?

For budgeting, a mortgage in principle is often quite helpful.

You can generally use it to:

understand the approximate borrowing range you may be considered for
sense-check whether a target property price is likely to be within reach
plan around affordability while you move to the full application stage

However, budgeting reliability depends on how closely your later full application matches the information used for the in-principle decision.

In many situations, it can be enough to support an offer, because it shows there is lender consideration based on your current information.

That said, reliability varies depending on factors such as:

how quickly you move from in-principle to full application
how complete and consistent your details are
whether the property type and situation align with what the lender requires

If you’re making an offer, it’s sensible to treat the in-principle decision as “likely, but subject to full checks.”

What can reduce avoidable risk between in-principle and full approval

You can’t control every factor a lender considers, but you can reduce the chances of avoidable problems by:

Keeping information consistent: ensure income, outgoings, commitments, and deposit details remain accurate.
Avoiding major financial changes: new credit commitments or significant changes in spending patterns can affect affordability.
Being cautious with additional credit activity: unnecessary applications can complicate the picture.
Providing documents promptly: delays can create pressure around timelines.
Using the decision while it’s current: in-principle decisions are issued with an expiry period, so letting it run down can create extra steps.

How a broker can help at this stage

A mortgage broker can help you understand how an Agreement in Principle fits into the wider process and how your situation may be viewed by lenders.

That can be particularly valuable if you:

Have complex income (for example self-employment)
Have existing credit commitments
Are buying with a partner and want to understand how affordability is assessed
Want to reduce uncertainty before making an offer

A broker can compare lender criteria for your circumstances.

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Frequently asked questions

Yes. You can request decisions from different lenders.

This can help you compare how different lenders assess your information. If credit checks are involved, it’s worth considering timing and how multiple requests may be recorded.

A DIP is based on the information available at the time and the lender’s criteria.

Differences can happen due to:

how a lender assesses income and outgoings
variations in lender criteria
changes between DIP stage and later checks
underwriting outcomes or the result of the property valuation

The same general principle applies when you’re looking to remortgage or switch, although terminology and process can vary.

An early indication can still be useful for understanding what borrowing might be available before moving into a full application.