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How to Get a Mortgage as a First-Time Buyer in the UK (Step-by-Step Guide)

  • Writer: Jamie Reid - Credit, Loans & Everyday Money Writer
    Jamie Reid - Credit, Loans & Everyday Money Writer
  • Feb 17
  • 5 min read

Updated: Apr 16

Buying your first home is a big financial step — and often a confusing one. From saving for a deposit to understanding lender criteria and securing an affordable mortgage, there’s a lot to consider.


In this in-depth UK guide, we walk you through the mortgage process as a first-time buyer. You’ll learn how to prepare, what to expect, and which government schemes could help you buy sooner than you think.


Whether you're just starting to save or you're ready to apply, this guide will help you take the right steps.


First-time UK homebuyer discussing mortgage options with advisor

What Is a First-Time Buyer?


A first-time buyer is someone purchasing their first residential property and who hasn’t owned a home before — either in the UK or abroad.


Being a first-time buyer often gives you access to:


  • Government schemes

  • Stamp Duty relief

  • Lender incentives (such as cashback or lower fees)


But you’ll still need to prove you’re a responsible borrower — and that starts with understanding your finances.


Step 1: Review Your Finances and Set a Budget


Before applying for a mortgage, assess your financial situation carefully.


Key Steps:


  • Check your credit score using free tools like Experian, Equifax, or TransUnion.

  • Tally your income vs outgoings using a free tool like the MoneyHelper Budget Planner.

  • Start building a deposit. Lenders usually expect at least 5%, but the more you save, the better your mortgage options.

  • Avoid taking on new debt or missing payments — these can impact your mortgage approval chances.




Step 2: Understand How Much You Can Borrow


Most mortgage lenders will lend around 4 to 4.5 times your annual income, though this can vary depending on:


  • Your credit history

  • Size of your deposit

  • Employment type (permanent vs self-employed)

  • Existing debts or financial dependents


Example:


  • Salary: £30,000

  • Potential loan: £120,000 – £135,000

  • With a 10% deposit (£15,000), you could afford a £150,000 home.


Tip: Use a lender’s online mortgage calculator to get a rough idea of your borrowing limit.


Step 3: Learn About the Main Mortgage Types


There are several types of mortgages suitable for first-time buyers:


Fixed-Rate Mortgages


  • Interest rate stays the same for 2, 3, 5, or even 10 years.

  • Predictable monthly repayments.

  • Good for budgeting.


Variable-Rate Mortgages


  • Interest rate can go up or down, depending on your lender’s standard variable rate.

  • Payments may fluctuate month to month.


Tracker Mortgages


  • Tracks the Bank of England base rate plus a set percentage.

  • Offers flexibility but comes with risk if interest rates rise.


Discount Mortgages


  • Discounted interest rate for a fixed time, usually 2-3 years.

  • Often revert to a higher rate afterwards.



Step 4: Explore Government Schemes for First-Time Buyers


First Homes Scheme


  • Get 30% to 50% off new-build homes.

  • Available to first-time buyers and key workers.

  • Income and local eligibility criteria apply.More info on gov.uk


Shared Ownership


  • Buy a share (25%-75%) of a home and pay rent on the rest.

  • Allows you to get on the ladder with a smaller deposit. Read more at MoneyHelper


Mortgage Guarantee Scheme


  • For properties up to £600,000.

  • Only 5% deposit needed.

  • Backed by the government to encourage lenders to offer low-deposit deals.


Lifetime ISA (LISA)


  • Save up to £4,000/year and get a 25% government bonus.

  • Use funds towards your first home or retirement.


Step 5: Get a Mortgage Agreement in Principle (AIP)


A Mortgage Agreement in Principle (also called a Decision in Principle) gives you a rough idea of how much you can borrow. It’s free, doesn’t commit you to anything, and shows estate agents you're a serious buyer.


Most AIPs are valid for 30 to 90 days.


Documents You May Need:


  • Payslips (last 3 months)

  • Bank statements

  • Proof of deposit

  • Photo ID



Step 6: Start Viewing Properties


With your AIP in hand, you can start searching within your price range.


Key considerations:


  • Local schools or transport links

  • Leasehold vs freehold

  • Energy efficiency (EPC rating)

  • Potential renovation or repair costs


Step 7: Make an Offer and Apply for a Mortgage


When you find a property, make an offer through the estate agent. Once accepted:


  1. Choose your mortgage product and lender.

  2. Submit a full application.

  3. The lender will conduct a valuation of the property.



Step 8: Conveyancing, Surveys, and Final Steps


Conveyancing


Hire a solicitor or licensed conveyancer to:


  • Handle legal paperwork

  • Conduct local authority searches

  • Finalise contracts


Surveys


Different levels of surveys include:


  • Mortgage Valuation (basic) – confirms the property’s value.

  • Homebuyer Report – checks for major issues.

  • Building Survey – more in-depth, suitable for older or unusual properties.


Exchange and Completion


  • Once everything is in order, contracts are exchanged.

  • On completion day, funds are transferred, and you get your keys.


Extra Tip: Consider a Mortgage Broker


While you can apply directly to lenders, a mortgage broker can:


  • Compare deals across multiple lenders

  • Help with complex cases (e.g., self-employed)

  • Offer guidance through the entire process


Some brokers are free (paid by lenders), while others charge a flat fee.



Frequently Asked Questions (FAQs)


What’s the minimum deposit needed for a first-time buyer?


You’ll usually need at least 5% of the property price. For better rates, aim for 10% or more.


Can I get a mortgage if I’m self-employed?


Yes — but you’ll likely need:


  • 2+ years of accounts

  • SA302 forms

  • Strong credit history


Is Stamp Duty waived for first-time buyers?


Yes — if you're buying a home under £425,000 in England or Northern Ireland, you won’t pay any Stamp Duty.


What if I have a poor credit history?


Some lenders offer “bad credit” mortgages, but rates may be higher. Improving your credit score and reducing debts will help.



Should I use a fixed or variable mortgage?


It depends. Fixed-rate mortgages offer certainty, while variable/tracker options could save money — but come with risk if rates rise.


Can I buy a property with someone else?


Yes — you can apply for a joint mortgage with a partner, family member, or friend. You’ll be jointly responsible for repayments.


Related article: Joint Mortgages Explained


Final Thoughts: Don’t Rush — Plan Strategically


Getting your first mortgage isn’t just about finding the biggest loan — it’s about long-term financial stability.


Take your time to:


  • Understand all the costs involved

  • Explore government help

  • Get professional advice where needed


The UK property ladder might seem hard to reach, but with preparation, support, and the right knowledge, it's within your grasp.



Disclaimer:  Smart With Money may receive compensation through affiliate links, sponsored content, or advertising featured on this site. This does not influence our editorial standards. All reviews and recommendations are based on independent research, and we aim to provide accurate, objective information to help you make informed financial decisions.


Please note:  All content on SmartWithMoney.co.uk is for informational purposes only and does not constitute financial advice. Always seek guidance from a qualified financial adviser before making any financial decisions.

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