First-Time Buyer Hub

Buying your first home is the biggest financial decision most people ever make, and the system does a great job of making it sound more complicated than it is. This guide strips out the jargon and walks you through the whole thing in plain English: working out what you can really afford, the deposit and the schemes that can get you there sooner, boosting your chances of being accepted, choosing the right mortgage, what it actually costs, and every step from first viewing to picking up the keys. Written by Darren Shepherd, who’s spent 36+ years in the UK mortgage industry.

How much can you afford?

Everything starts here. Get a real number before you fall in love with a kitchen.

Lenders work out what they’ll lend using two things: a multiple of your income, and an affordability test of your actual budget. As a rough guide, most lenders offer around 4.5× your income, with some going to 5 to 5.5× for higher earners and a handful to 6× in particular cases. So two people earning £30,000 each (£60,000 joint) might borrow around £270,000.

But the multiple is only the ceiling. Lenders then “stress test” your budget, your other debts, credit commitments, childcare and regular outgoings all reduce what they’ll offer, and they check you could still pay if rates rose. That’s why two people on the same salary can be offered very different amounts.

Do this first: get a realistic figure with our free affordability calculator, then read the affordability guide to understand what lenders really look at. Every step after this is built on that number.

Your deposit, and the schemes that help

How much you put down changes the rate you get. And you have more options than you think.

The minimum deposit is usually 5% of the purchase price, but the more you put down, the lower your loan-to-value (LTV) and the better the interest rates you can access. Each band tends to unlock a better deal:

Read our deposit guide for the real cost of each band. And if a big deposit feels out of reach, these can help:

• • Lifetime ISA, the government adds 25% to your savings (up to £1,000 a year) towards a first home. See how it stacks up against a Help to Buy ISA.
• • 95% mortgages & the mortgage guarantee, buy with just a 5% deposit. Our Freedom to Buy / mortgage guarantee guide explains how.
• • Shared ownership, buy a share (often 25 to 75%) and pay rent on the rest, so you need a much smaller deposit.
• • A gifted deposit, money from family is fine with most lenders, as long as it’s a genuine gift and documented properly.
• • Guarantor and joint borrower sole proprietor mortgages, a parent’s income can boost what you can borrow without them owning the home.
• • See all options in our first-time buyer schemes guide.

Boosting your chances of approval

Small things done early can be the difference between a yes and a no. Start 6 to 12 months out.

Lenders score you on how reliably you handle credit. You don’t need a perfect record, you need a tidy one. A few high-impact moves:

• • Get on the electoral roll at your current address, it’s one of the quickest ways to lift your score.
• • Check all three agencies (Experian, Equifax, TransUnion) for errors, lenders may use any of them.
• • Don’t apply again straight after a rejection, space applications out; each hard search leaves a mark.
• • Lower your utilisation, using a smaller share of your available credit limit helps.
• • Avoid cash withdrawals on credit cards and stay out of your overdraft in the months before applying.
• • Keep older accounts open, a longer credit history works in your favour.

Had a default, missed payments or a thin file? It’s rarely game over, see getting a mortgage with bad credit.

Choosing the right mortgage

Two quick decisions: how you repay it, and what kind of rate you want.

How you repay: almost all first-time buyers go for a repayment mortgage, each payment clears a bit of the loan, so you own the home outright at the end. Interest-only is hard to get and rarely suitable for first-timers.

What kind of rate:

• • Fixed rate, your payments are locked for a set period (commonly 2 or 5 years). Certainty, easy to budget. Most first-time buyers choose this.
• • Tracker / variable, follows the Bank of England base rate up and down. Can be cheaper, but your payments can change. See fixed vs tracker.
• • Offset, links your savings to your mortgage to cut the interest you pay.

Two things to watch: early repayment charges if you leave a deal early, and the value of overpaying, even small regular overpayments can save thousands and shave years off the term.

The true cost of buying

The deposit is the big one, but it’s not the only cost. Budget for these so nothing catches you out.

• • Stamp duty, often £0 for first-time buyers (see below), but check. Calculate yours.
• • Mortgage fees, arrangement/product fee, valuation, and sometimes a booking fee. Our guide to mortgage fees breaks them down.
• • Conveyancing (legal), roughly £1,000, £2,500 including searches. See the conveyancing guide.
• • Survey, the lender’s valuation isn’t a survey; a proper house survey can save you thousands.
• • Moving costs, removals, and the odd bill on day one. Estimate them here.

Stamp duty for first-time buyers

First-time buyers get a tax break, but it works differently across the UK.

• • England & Northern Ireland (SDLT): first-time buyers pay 0% on the first £300,000, on homes worth up to £500,000.
• • Scotland (LBTT): a first-time buyer relief raises the nil-rate threshold; rates and bands differ from England.
• • Wales (LTT): there’s no specific first-time buyer relief, but the starting threshold means many pay nothing on lower-priced homes.

Thresholds change, so always check the figure for your purchase with our stamp duty calculator.

Your step-by-step journey

Should you use a mortgage broker?

You can go direct to a lender, but a good broker usually saves you time, stress and money.

A mortgage broker compares deals across many lenders, handles the paperwork, and matches you to a lender likely to say yes, which matters a lot when your situation isn’t totally standard. A whole-of-market broker can look across the market rather than a single lender’s range. Brokers are paid a commission by the lender, and some also charge their own fee, so ask upfront what you will pay. The big win for a first-time buyer is avoiding a rejection that dents your credit, and not overpaying on a rate you found yourself.

That’s exactly what Debbie at DS Financial does, whole-of-market, no pressure, and happy to talk things through before you commit to anything.

Protecting your home & family

Some cover is essential, some is worth it, and some is an overpriced add-on to avoid.

You will need buildings insurance in place by exchange, lenders insist on it. Beyond that, it’s worth thinking about what happens to the mortgage if your income stopped:

• • Life cover, pays off the mortgage if you die, so your family keeps the home.
• • Income protection, replaces part of your income if you can’t work through illness or injury.
• • Critical illness cover, pays out a lump sum if you’re diagnosed with a serious condition.

Watch the hard-sell: you don’t have to buy insurance from your lender or estate agent, and bundled cover or old-style mortgage payment protection (MPPI) is often poor value. Shop around, and know the difference between buildings and contents insurance.

Key videos for first-time buyers

Start with these, Darren covers the most important topics every first-timer needs to understand.

Key terms explained

Don't let jargon trip you up. Here are the five terms every first-time buyer needs to know.