Buying a house is an exciting endeavour, of course, but there are lots of boxes you’ll need to tick before you exchange contracts and get the keys to your new front door… and it can take months to complete the process.

Aside from househunting and narrowing down your preferred location, one of the very first steps you’ll need to take is sorting out a mortgage agreement in principle (also known as a decision in principle).

This will give you a better idea of how much you’ll be able to borrow before you apply for your actual mortgage. In order to ascertain this, you will be asked a series of questions about your finances, with lenders also looking at current interest rates to determine affordable repayment rates based on your specific circumstances.

What is important to remember, however, is that your agreement in principle isn’t a guarantee that you’ll get a mortgage when you come to complete your full application. Lender criteria can change, as can your circumstances, or you may be offered different terms, so be prepared for anything at this point.

To apply for your agreement in principle, you’ll need to have the exact details of your income and your outgoings, as well as any credit agreements you currently have, and your addresses for the last three years.

Typically, the agreement is valid for between 30 and 90 days, so once you’ve got it all arranged you can start househunting in earnest, looking for your dream home.

Of course, you can househunt before you have your agreement in place but you might find that estate agents aren’t overly inclined to book you in for viewings if you don’t have one agreed, particularly if there are too many buyers on the market and a shortage of housing stock.

If this all sounds a little confusing and you’d like further clarification, get in touch with the Bowen Mortgages team today for free mortgage advice.