How long do Decisions in Principle usually last?

They typically last between 14 and 90 days depending on the lender, product and whether the DIP included a rate lock or relied on recent credit data.

What should I do after I receive a DIP?

Use the DIP period to prepare and submit supporting documents, decide on the amount and terms you need, and move to a full application before the DIP expires to reduce the chance of re-checks or changes.

How long is a Decision in Principle valid and what happens next?

Q: Does a DIP guarantee I will get a loan?

No. A DIP is indicative and non-binding; formal approval requires full underwriting, documentation checks and any lender conditions to be satisfied.

Quick answer

A Decision in Principle (DIP) — sometimes called an Agreement in Principle or Eligibility Check — is typically valid for between 14 and 90 days depending on the lender and product. During that period the lender confirms it is likely to lend based on the information provided, but the DIP is not a formal offer and is subject to change once full checks are completed. After the DIP expires you usually need to refresh the check or submit a full application, and the lender will re-run underwriting, checks and any valuations before issuing a formal offer.

What a Decision in Principle (DIP) actually is

A Decision in Principle is a preliminary statement from a lender that indicates whether, based on the information you supplied, they would be prepared to lend and roughly how much. For business finance this is a helpful early signal that your company profile, turnover and sector fit the lender’s criteria. A DIP is usually produced after a light credit check and a review of key figures rather than a full underwriting process.

Importantly, a DIP is not a legally binding loan offer and it does not guarantee terms. It helps businesses understand likely eligibility and supports budgeting, planning and negotiations with suppliers or partners. Many lenders use DIPs to fast-track suitable prospects to the full application stage.

For commercial lending the DIP may be called an Eligibility Check, Indicative Offer or Pre-Approval depending on the provider. Different names signal similar outcomes: conditional, non-binding assessment based on initial data.

Typical validity periods and why they differ

Most DIPs last between 14 and 90 days, though some specialist lenders can issue shorter or longer windows. High-street banks commonly set 30–90 days for business finance, while alternative or online lenders may use 14–30 days. The term is driven by internal underwriting policy, market conditions and the type of product being considered.

Factors that influence the validity period include whether the DIP included a rate lock, the speed at which economic conditions are changing, and how long the lender will rely on previously collected credit data. Lenders offer shorter DIPs when credit files must be kept current or when interest rates are volatile. Conversely, if a lender has more confidence in historical data or is offering a simple product, the DIP window can be longer.

For asset finance or invoice finance DIPs, shorter windows are common because invoice books, asset values and debtor profiles can change rapidly. For larger or backed facilities, like a refinance or tailored facility, the DIP may be conditional on obtaining further documentation and therefore have a shorter or more flexible expiry.

What happens while a DIP is valid

Once you receive a DIP you should use the period to gather documents and firm up your requirements. Typical actions include assembling management accounts, bank statements, VAT returns, contracts and asset lists where relevant. Brokers and introducers commonly use the DIP window to shop options and compare terms from different lenders.

During the DIP period lenders may still perform soft credit checks or request clarification on specific items, but they usually avoid hard searches until you submit a full application. If you change your funding amount, purpose or business structure you should notify the lender as it may affect the DIP validity or the decision itself. A DIP also gives you negotiating leverage when discussing rate, term or security with potential financiers.

For businesses using a broker or a matching platform, the DIP helps route enquiries to lenders actively lending to that sector. If you want to explore options immediately, submit a Quick Quote or Eligibility check so our AI matching system can introduce you to suitable lenders or brokers while your DIP remains valid.

What happens when a DIP expires or is refreshed

If a DIP expires you generally need a fresh check and possibly an updated application. Lenders will usually re-run credit searches, verify accounts and reassess sector or asset values before issuing any formal offer. This can change the outcome if your circumstances or market conditions moved since the original DIP.

When a DIP is refreshed the lender compares new information to the original submission; small, temporary fluctuations in turnover or cashflow rarely change a positive DIP, but material changes — recent missed payments or major contract losses — can. If the lender’s terms or appetite have changed, you may face different pricing or additional conditions at full application stage. Always confirm whether the lender will apply a fresh credit search and whether a fee applies for reissuing a DIP.

If your DIP converts to a formal offer the lender will set out conditions (for example, security to be taken, personal guarantees or outstanding documents). The full approval process can then involve valuations, legal checks and covenant negotiation, which typically adds several weeks to the timeline depending on complexity and provider speed.

Practical tips, next steps and how Best Business Loans helps

To maximise the usefulness of a DIP, be accurate and complete when you provide information and upload supporting documents promptly if asked. Ask the lender or intermediary how long the DIP is valid, whether rates are locked and what triggers a hard credit search. Keep records of the DIP communication so you can reference it when comparing offers.

If the DIP is positive and you’re ready to proceed, move quickly to full application while the window remains open. If it expires and circumstances are unchanged, request a refresh and confirm whether the lender will re-run credit checks. If your situation changed materially, discuss the impact with your broker or introducer before reapplying.

Best Business Loans does not supply loans directly; we introduce UK businesses to lenders and brokers who can help. Our AI-driven Quick Quote and Eligibility checks are designed to match you with providers who are actively lending in your sector. If you want to explore options and obtain a DIP or an Eligibility Check, start a Quick Quote today and let our matching process do the heavy lifting.

Key takeaways

A Decision in Principle is an indicative, non-binding assessment and is usually valid for 14–90 days.
Validity depends on lender policy, product type and how stable the applicant’s financials are.
Use the DIP period to compile documents and prepare for a full application to avoid delays.
After expiry you’ll normally need to refresh the DIP and undergo updated checks before a formal offer.
Best Business Loans can match your business to lenders and brokers who will move the process forward.

Frequently asked questions

Is a DIP the same as a loan approval?

No. A DIP is a preliminary indication of likely lending; a formal loan approval requires full underwriting, documentation and any conditions to be satisfied. Always treat a DIP as informative rather than definitive.

Will a DIP affect my credit score?

Most DIPs use soft credit checks that do not affect your credit score, but confirm this with the lender. Ask whether a hard search will be performed at full application so you can time submissions appropriately.

Can I use a DIP to negotiate with suppliers or partners?

Yes. A current DIP can reassure stakeholders that funding is likely, but because DIPs are non-binding you should avoid presenting them as guaranteed funding. Where certainty is required, proceed to formal approval and drawdown first.

For more guidance on the kinds of finance we support and the sectors we help, see our small business loans overview for examples and sector-specific advice: small business loans.

Ready to check eligibility?

If you want to obtain a Decision in Principle or a fast Eligibility check, complete our Quick Quote form and our AI will match you to lenders and brokers who fit your needs. It’s free to submit and helps you move from a DIP to a full application with fewer delays. Start your Quick Quote now and get matched to relevant finance options for your UK business.

Best Business Loans is an independent introducer; we do not lend. We share your details only with vetted lenders and brokers who may contact you about suitable products. If you need help before you apply, email hello@bestbusinessloans.ai and our UK support team will explain the next steps.