Get formal loan approval now or later?

B

bobo

Registered User
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Hi, we got approval in principle from our broker for an AIB 100% mortgage of value €410k a few weeks ago and since then have found a property which is for sale at €395k. We are thinking of putting a offer in at this level. At this stage should we inform our mortgage broker so that we can get our formal loan approval sorted or would that just be jumping the gun?? I'd like to get as much paper work out of the way at this stage to avoid delays as the quicker contracts are signed on any property we find the better.

thanks,
C
 
Most loan offers last for six months so I think you'd be safe enough to look for formal approval now. Talk to your broker. I wouldn't make an offer on a property until the actual loan offer was on the table. If you do a search of the site I'm sure you'll find information on how long tthis takes etc.
 
Yes, once you have approval in principle (which is normally valid for six months) you can go ahead and start bidding on properties. You don't need to apply for a full loan offer until your offer is accepted and you are ready to get the house surveyed and valued for mortgage purposes.

Sarah

www.rea.ie
 
I thought approval in principle didn't mean you were guaranteed to get a loan offer, particularly if circumstances or interest rates change?
 
liteweight said:
I thought approval in principle didn't mean you were guaranteed to get a loan offer, particularly if circumstances or interest rates change?
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That doesn't stop you bidding on a property or even paying a refundable booking deposit.
 
whathome said:
That doesn't stop you bidding on a property or even paying a refundable booking deposit.
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Yes I realise that. :rolleyes: The OP wanted to get as much of the paper work out of the way as possible so I thought, get it done. Looking at it again, I suppose the OP might have meant it as in 'can I go ahead with this property?...'
 
yep, i really just meant can i get as much paper work out of the way now rather than later....
 
liteweight said:
Yes I realise that. :rolleyes:
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So why did you say this?

liteweight said:
I wouldn't make an offer on a property until the actual loan offer was on the table.
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If the OP was to wait for the actual loan offer before making a bid, they could miss out on the property altogether.
As Sarah said, you can go ahead and start bidding on properties once you have approval in principle.

bobo said:
yep, i really just meant can i get as much paper work out of the way now rather than later....
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No harm in that but if you want the property, don't hold off on bidding while waiting for the actual loan offer to arrive.
 
Approval in principle isn't specific to a property, a formal loan offer is. Therefore until Bobo has had an offer accepted on a property and has informed his/her broker of the address a loan offer can't be issued. Unless there has been a material change in Bobo's circumstances since the AIP issued there is no reason not to go ahead with the offer.

Now, back to the rugby!

Sarah

www.rea.ie
 
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