First-Time Buyer Guide | Buying your first home is exciting, but it can feel overwhelming. This guide explains every key step in simple terms. You will learn how to save a deposit, check affordability, compare mortgages, and understand the full buying process. It also explains government schemes that support first-time buyers in the UK.
A first-time buyer guide is most useful when you start planning early. You will make confident decisions when you understand the steps clearly.
Understand Your Budget and Affordability
You must understand your budget before you view any homes. This prevents stress and avoids disappointment later in the process. A clear budget helps you focus on homes you can afford today.
Check Your Income and Outgoings
Start by reviewing your income and monthly spending. Lenders check these details during your mortgage assessment. They want to see stable income and sensible spending habits.
Create a simple budget that lists your rent, bills, food costs, travel costs, and loan payments. This helps you understand how much you can afford each month.
Check Your Credit Score
Your credit score affects your mortgage options. A higher score gives you access to more lenders and better rates. Check your score with a trusted credit agency. Improve your credit by paying bills on time and clearing small debts. Avoid new credit applications during the buying process.
Understand Mortgage Affordability
Most lenders allow you to borrow up to 4.5 times your income. Some lenders offer higher multiples for strong applicants. Your income type can also affect the amount you can borrow.
Use a simple affordability calculator to estimate your borrowing range. A mortgage broker can also give clear guidance on your borrowing limits.
Plan Your Deposit Early
Your deposit plays a major role in your mortgage options. A larger deposit reduces your interest rate and increases lender choice. First-time buyers should plan early and save consistently to build a strong financial foundation.
Deposit Requirements
Most first-time buyers need a deposit of at least 5 per cent. A higher deposit gives you access to better rates. A 10 per cent deposit is a strong starting point for many buyers. A 15 per cent deposit can unlock even more competitive options. Lenders reward higher deposits because they reduce lending risk.
Average Deposits Today
UK first-time buyers save significant deposits to enter the market. Many save over £30,000. Buyers in major cities often need more because property prices are higher. London buyers usually need larger deposits because average property values are above national levels. Saving early helps you meet these rising deposit expectations.
Ways to Save Faster
You can speed up your savings with simple habits. Set up automatic transfers into your savings account each month. Cut unnecessary spending and track your budget closely. Use a Lifetime ISA for a government bonus of 25 per cent. Ask family members about gifted deposits if this suits your situation. Review your spending every month to stay on track.
Understand Key Mortgage Types
Learning the basics helps you choose the right mortgage.
Fixed-Rate Mortgages
Your rate stays the same for a set period. These help with predictable payments.
Variable-Rate Mortgages
Your rate may change. You might pay more or less over time. Ask your adviser to explain the risks.
Buyers Need Clear Advice
You can read more about broker support in our How to Find a Mortgage Broker guide.
Government Schemes for First-Time Buyers
Several schemes support you when buying your first home.
Shared Ownership
You buy part of a property and pay rent on the remainder. This reduces upfront costs.
First Homes Scheme
This scheme offers discounted homes to eligible first-time buyers.
Lifetime ISA
You receive a government bonus of 25 per cent when you save for your first home.
Stamp Duty Rules
Most first-time buyers pay no stamp duty on homes up to current thresholds. Always check current limits before you buy.
Get a Mortgage in Principle
A Mortgage in Principle helps you show estate agents you are serious. It gives an estimate of how much you can borrow. A broker can arrange this quickly.
Work With a Mortgage Broker
A mortgage broker can save you time and stress. They compare lenders and explain your options.
Benefits of Using a Broker
A broker has access to many lenders. They help with complex cases. They guide you through the application process. You can explore UK brokers within our Connect Mortgage Broker Directory.
Key Checks Before You Choose a Broker
Choose an adviser who is FCA-authorised. Ask how many lenders they use. Read reviews and check experience.
First-Time Buyer Stages
| Stage | What Happens |
|---|---|
| Mortgage Application Process | Your adviser helps you gather the required documents like payslips, bank statements, and ID. |
| The lender checks your credit history and confirms your affordability. | |
| The lender then assesses your documents and supporting information. | |
| Once approved, the lender issues a formal mortgage offer. | |
| Offer, Conveyancing, and Surveys | The seller accepts your offer, and the sale begins. |
| A solicitor guides the legal process and explains each stage clearly. | |
| The solicitor checks contracts, performs searches, and raises enquiries. | |
| Most buyers also arrange a professional survey before they proceed. | |
| The survey assesses the property’s condition and identifies potential issues. | |
| Completion and Moving In | Completion happens when the property legally becomes yours. |
| Your solicitor transfers the mortgage funds to the seller. | |
| You receive your keys once the sale completes. | |
| You can now move into your new home. |
As a first-time buyer, you should use a trusted mortgage adviser. They can compare lenders and secure the right deal for you.
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Frequently Asked Questions – First-Time Buyer Guide
| Question | Answer |
|---|---|
| How much deposit do first-time buyers need? | Most buyers need at least 5 per cent. A deposit of 10 per cent offers better rates and more lenders. |
| Can first-time buyers buy with poor credit? | Some lenders accept lower credit scores. You might need a larger deposit. A broker can guide you. |
| How long does the process take? | Most purchases take 8 to 12 weeks. Complex cases can take longer due to legal checks. |
| Should I use a mortgage broker? | Yes. A broker saves time and helps secure better deals. See our How to Find a Mortgage Broker guide. |
| What documents do first-time buyers need? | You will need ID, payslips, bank statements, and proof of address. Lenders check all documents carefully. |
| What extra costs should first-time buyers expect? | Expect legal fees, surveys, moving costs, and possible stamp duty. See our Home-Buying Cost Checklist page. |
| Can I buy with a 5 per cent deposit? | Yes. Many lenders accept 95 per cent mortgages. Rates may be higher than larger deposit options. |
| Do first-time buyers pay stamp duty? | Many pay no stamp duty on homes below current thresholds. Always check the latest rules before buying. |
| Can I get a mortgage if I am self-employed? | Yes. You must show stable income. Lenders may request account information or tax returns. Brokers help with this. |
| What is a Mortgage in Principle? | It is a lender’s estimate of your borrowing amount. Estate agents often request this before viewings. |
| Do first-time buyers need a survey? | A survey protects you from hidden issues. Most buyers arrange at least a basic report. |
| Can I use a Lifetime ISA for my deposit? | Yes. You receive a 25 per cent government bonus toward your deposit. Conditions apply. |
| What is Shared Ownership? | You buy part of a property and pay rent on the remaining share. It lowers upfront costs. |
| Can I buy a property without a broker? | Yes. But you may miss better deals. Brokers compare lenders and support your application. |
| How do lenders calculate affordability? | Lenders review income, spending, credit score, and deposit size. They aim to reduce lending risk. |
| What is an Agreement in Principle? | It is the same as a Mortgage in Principle. It shows estate agents your budget. |
| Are interest rates higher for first-time buyers? | Rates depend on deposit size and credit history. Larger deposits often secure lower rates. |
| Can I buy with gifted deposit money? | Yes. Lenders allow gifted funds. They require a signed gift letter confirming no repayment is needed. |
| Do I need buildings insurance? | Yes. Lenders require buildings insurance from completion day. It protects your home against damage. |