What to do if You’ve had a Mortgage Declined After an AIP

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Home Mortgage Refused What To Do If You’ve Had A Mortgage Declined After An AIP

Author: Pete Mugleston

Mortgage Advisor, MD

Updated: March 15, 2024

An agreement in principle (AIP) is a tentative deal between you and a mortgage lender that lays out how much they’d be willing to let you borrow and on what terms. Many AIP applications go through without a hitch, while others are rejected, and some people even find that they’re offered an agreement in principle only to be declined later on.

If you’ve been declined after an agreement in principle or have had an AIP rejected, this guide is for you. Here, you’ll learn what to do if your mortgage application has fallen down at either of these stages, why this can happen and where to get the right advice if it has.

What to do if you were offered a mortgage agreement in principle but then declined

An Agreement in Principle is not a final decision. Being declined at this stage indicates potential issues with your credit history, property valuation, or affordability concerns. To address this, understand the specific reason, review your finances, seek advice, and consider exploring options with other lenders.

To navigate through this hurdle and realign your mortgage application process, consider the following steps:

1. Don’t re-apply just yet

Rushing into another application so soon can have dire consequences for your mortgage aspirations. There are many reasons why your lender might have changed their mind after the AIP stage, and there’s no guarantee the issue won’t resurface next time.

Take a pause to get your bearings and see if you can find out exactly why your lender declined your application after offering you an agreement in principle. If you can’t get your hands on this information, don’t worry; simply move on to step two below.

2. Let us match you with a mortgage broker

Not all mortgage brokers are the same. Some have very specific areas of expertise, and in our broker network, there are advisors who specialise in reviving mortgage applications that have stalled after or during the agreement in principle stage.

They have the knowledge, expertise and lender contacts you need to help you reclaim your plans, whether that’s with your current lender or a new one who is offering a better deal.

3. Let your broker take things from here

You’ll barely have to lift a finger while the broker we match you with carries out a quick fact-find to get to the bottom of why your mortgage lender changed their mind. Once they’ve established this, they will offer you bespoke advice and get to work on a solution.

They will explore whether there are grounds to appeal against your lender’s decision to decline you after the AIP stage and take the lead on the renegotiations. But they’ll also explore whether it’s in your best interest to pursue an alternative mortgage offer elsewhere. They will search the entire market to find the lender best positioned to offer you a top deal.

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Why a mortgage would be declined after an AIP

You can be declined a mortgage after an agreement in principle for the following reasons…

  1. Failing the final credit check: Some lenders have their underwriter carry out a more thorough credit check before making a full mortgage offer. During this check, bad credit that went undetected during the AIP can come to light and trigger a rejection.
  2. Your circumstances have changed: If your income has dropped, your outgoings significantly increased or bad credit has appeared on your file since you were offered the AIP, your lender could get wind of this during their final checks and decline you.
  3. There’s an error on your application: A simple error on your mortgage application can derail the whole process at any point, even if you had an AIP in the bag.
  4. The lender suspects fraud: Mortgage lenders can pull the plug on an application at any time before completion if they suspect fraud might be going on. They might be concerned this is the case if any of the details you provided for the AIP are inconsistent with what the lender sees when they carry out their final checks.
  5. The lender has changed their criteria: Lending criteria changes all the time, and if your mortgage provider decides to alter its requirement after offering you an AIP, they have the right to change your mortgage offer or decline you altogether.

Other reasons

These are merely a handful of reasons why a mortgage application might be rejected beyond the decision in principle stage. The mortgage brokers we work with can help you regardless of why your mortgage application has stalled. If there is no room to renegotiate with your current mortgage provider, they could match you with another lender who…

  • Specialises in bad credit mortgages and is known to overlook most credit issues
  • Could approve you even if your circumstances have changed
  • Has a higher appetite for risk than lenders on the high street
  • Won’t penalise you with high rates because you’ve been declined once

What’s more, your broker will even give you hand with your paperwork so you can rest assured there won’t be any errors that could come back to bite you later.

Make an enquiry and we will match you with a broker who specialises in reviving mortgage applications that stalled at the agreement in principle stage today.

Tamsin's Story

"Without Online Mortgage Advisor we'd have certainly lost our home"

After a bad credit rating stopped Tamsin’s mortgage application in it’s tracks, see how expert advice helped Tamsin keep her family home, and read other success stories from our customers

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What to do if you’ve had a decision in principle declined

The steps to take are much the same as the ones we outlined in the previous section, and keep in mind that this might not be the setback you think it is. Most mortgage lenders only carry out a soft credit check during the AIP, so your credit file is unlikely to be tarnished.

There are all kinds of reasons why a lender might turn you down for an AIP including…

  • Bad credit
  • Not enough deposit
  • Your deposit source raises concerns
  • Affordability issues
  • The property is ‘unmortgageable’
  • You’re considered too old
  • Not enough proof of income
  • Not enough address history
  • And many other reasons

Whatever the reason you were knocked back for an AIP, the good news is that the brokers in our network can significantly improve your chances of getting approved elsewhere. They have deep working relationships with the specialist lenders who have a flexible stance on all of the above, and they could negotiate an even better deal with one of them on your behalf.

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What to do if you’ve been declined after an AIP by a specific lender

The brokers we work with can help you regardless of which mortgage lender declined you either at the AIP phase or after it. But we have standalone guides for people who have been declined by a specific lender that you might want to read before making an enquiry…

Article key takeaways

  • 01

    You can still get approved for a mortgage:

    Being declined before or after an agreement in principle isn’t the end of the road for you. There could be grounds to appeal against your lender’s decision or find a new deal elsewhere.
  • 02

    Professional advice is a must from here:

    A further rejection at this stage could be costly. If you’ve been declined once already, seeking professional advice from the right broker is the best way to avoid being turned away again.
  • 03

    We can find the right broker for you:

    Our free broker-matching service can pair you with an advisor who specialises in turning mortgage rejections into approvals, even for customers who were declined after being offered an AIP.
  • 04

    The right broker could save you time and money:

    Using a handpicked broker who’s the perfect fit for your needs and circumstances is the best and quickest way to get approved for a mortgage after being declined after an AIP. Their expertise could help you save time, money and any further setbacks in the long run.


If you’ve been offered an agreement in principle by a mortgage lender, your chances of getting a mortgage offer from them are good, but it’s not uncommon for deals to break down after this part of the process. Some lenders carry out extra checks before final approval and issues that went undetected during the AIP can come to light.

If your application is complex or is considered risky, there’s a good chance the lender will request extra underwriter scrutiny and additional checks before final approval.

No. It won’t impact your credit report or jeopardise future applications for finance. This is because most lenders don’t carry out a hard credit check while assessing applicants for an agreement in principle, so other lenders won’t see this on your file.

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About the author

Pete, an expert in all things mortgages, cut his teeth right in the middle of the credit crunch. With plenty of people needing help and few mortgage providers lending, Pete found great success in going the extra mile to find mortgages for people whom many others considered lost causes. The experience he gained, coupled with his love of helping people reach their goals, led him to establish Online Mortgage Advisor, with one clear vision – to help as many customers as possible get the right advice, regardless of need or background.

Pete’s presence in the industry as the ‘go-to’ for specialist finance continues to grow, and he is regularly cited in and writes for both local and national press, as well as trade publications, with a regular column in Mortgage Introducer and being the exclusive mortgage expert for LOVEMoney. Pete also writes for Online Mortgage Advisor of course!

Read more about Pete

Pete Mugleston

Mortgage Advisor, MD

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