First-Time Buyer Mortgage Guide: Everything You Need to Know

To get a first-time buyer mortgage in the UK, you will usually need a deposit of at least 5% of the property price, a steady income that a lender is happy with, and a credit history that shows you manage borrowing well. Beyond that, the process follows a fairly predictable path.

This first-time buyer mortgage guide walks through the whole journey in plain English: what counts as a first-time buyer, how much you may be able to borrow, the help that is available, the costs to budget for, and each step from saving to getting the keys.

Key points

• A deposit of 5% is the typical minimum, but a bigger deposit can open up lower rates.
• Lenders often cap borrowing at around 4.5 times income, and many people are offered less.
• In England and Northern Ireland, first-time buyers pay no Stamp Duty on the first £300,000 of a home costing up to £500,000.
• A Lifetime ISA can add a 25% government bonus to your deposit savings, within set rules.
• The buying process has clear stages, and knowing them in advance can make it far less stressful.

What counts as a first-time buyer?

For Stamp Duty purposes, a first-time buyer is someone who has never owned an interest in a residential property in the UK or anywhere else in the world, and who intends to live in the new home as their main residence. If you are buying with someone else, you all need to be first-time buyers to claim the relief.

This catches some people out. If your partner has owned a home before, even years ago, your joint purchase will not qualify for first-time buyer relief, although you may still be able to access first-time buyer mortgage deals with some lenders, depending on their criteria.

How a first-time buyer mortgage works

A mortgage is a loan secured against the home you are buying. You borrow the difference between your deposit and the purchase price, then repay it in monthly instalments over an agreed period called the term. A longer term usually means lower monthly payments but more interest paid overall, while a shorter term works the other way round.

Most residential mortgages are on a repayment basis, which means each monthly payment covers some interest and chips away at the amount you owe. By the end of the term, the loan is paid off in full.

Loan-to-value (LTV) explained

Loan-to-value, or LTV, is the size of your mortgage as a percentage of the property’s value. If you buy a £250,000 home with a £25,000 deposit, you borrow £225,000, which is 90% LTV.

LTV matters because lenders price their deals, including first-time buyer mortgage deals, in bands. Generally, the lower your LTV, the more deals you can choose from and the lower the interest rates tend to be.

Choosing a rate type

Your mortgage rate can be fixed for a set period, or it can move up and down. Each type suits different priorities, such as certainty over monthly payments or flexibility. Our guide to fixed, variable and tracker mortgages explains how each one works and the trade-offs involved.

How much deposit do you need?

The typical minimum deposit is 5% of the purchase price. It is not a legal rule, but it is the lowest deposit most mainstream lenders accept. A government-backed Mortgage Guarantee Scheme, made permanently available from July 2025, encourages lenders to offer mortgages at 91% to 95% LTV.

The table below shows how different deposit sizes work out on an illustrative £250,000 home.

Illustrative example only. Deposit = price × deposit %; mortgage = price − deposit.

For a deeper look at deposit sizes, saving strategies and what lenders look for, see our guide on how much deposit you need to buy a home.

How much can you borrow?

When you apply for a first-time buyer mortgage, lenders look at two things: whether your income can support the loan, and whether your outgoings leave enough room to keep up payments. According to MoneyHelper, many lenders cap borrowing at around 4.5 times annual income, and most people are offered less than that.

For example, if two people buying together earn £55,000 a year combined, 4.5 times income would be £247,500 (£55,000 × 4.5). That is a ceiling, not a guarantee. The actual figure depends on the lender’s own checks.

What lenders check

• Income: payslips, bank statements and, if you are self-employed, accounts or tax calculations.
• Outgoings: credit card and loan payments, childcare, bills, council tax and everyday spending.
• Credit history: how you have managed credit in the past, including any missed payments.
• Stability: how long you have been in your job and how secure your income looks.

It may also be worth asking yourself whether you could still afford payments if interest rates rose, or if your income dropped for a while. Having some savings set aside as a buffer can give you breathing space.

Help available for first-time buyers

Lifetime ISA

A Lifetime ISA (LISA) lets you save up to £4,000 a year, and the government adds a 25% bonus, worth up to £1,000 a year. You must be 18 or over but under 40 to open one.

To use it for a first home without a penalty, the property must cost £450,000 or less, you must buy at least 12 months after your first payment in, you need to use a conveyancer or solicitor, and you must be buying with a mortgage. If you take money out for any other reason before age 60 (other than terminal illness), a 25% withdrawal charge applies. That charge can leave you with less than you paid in, so a LISA works best when you are fairly confident about how you will use it.

The proposed First Time Buyer ISA

The government has consulted on a new First Time Buyer ISA, which it says will be offered in place of the Lifetime ISA once available. The consultation closed on 18 August 2026, and no launch date has been confirmed. The consultation says existing LISA holders will be able to keep saving into their LISA under the current rules.

Shared Ownership

Shared Ownership lets you buy a share of a home, usually between 25% and 75% (some homes offer 10%), and pay rent on the rest. You need a mortgage only for the share you buy. Rules differ in Scotland, Wales and Northern Ireland, and the scheme has its own costs and restrictions, so reading the details carefully is important.

Help from family

Some first-time buyers receive a gifted deposit from family. Lenders usually ask for a signed letter confirming it is a gift, not a loan, along with proof of where the money came from. Some lenders also offer family-backed mortgages, where a relative’s savings or property support the application.

The costs to budget for

The deposit is the biggest upfront cost, but it is not the only one. Planning for the others early can help avoid a last-minute squeeze.

• Stamp Duty (or the equivalent tax): depends on the price and where in the UK you buy.
• Legal fees: a conveyancer or solicitor handles the legal side, plus local searches.
• Survey: an independent check of the property’s condition, separate from the lender’s valuation.
• Mortgage fees: some deals have product or arrangement fees; some advisers also charge a fee.
• Moving and setting up: removals, furniture, and any early repairs.

Stamp Duty for first-time buyers in England and Northern Ireland

First-time buyers pay no Stamp Duty Land Tax (SDLT) on the first £300,000, then 5% on the portion from £300,001 to £500,000. If the price is over £500,000, the relief cannot be claimed and standard rates apply.

Illustrative examples using current GOV.UK rates. £400,000 first-time buyer: 5% × (£400,000 − £300,000) = £5,000. Standard: 2% × £125,000 + 5% × £150,000 = £10,000.

Your conveyancer usually files the SDLT return, and the tax must be paid within 14 days of completion.

Getting ready to apply

A little preparation before you apply for a first-time buyer mortgage can make the process smoother and reduce the chance of surprises later on.

Tidy up your credit file

Lenders look closely at your credit history. Checking your file with the main credit reference agencies lets you spot mistakes and get them corrected. Registering on the electoral roll at your current address can also help lenders confirm who you are.

In the months before applying, it may be worth avoiding new credit applications where you can, because each full application leaves a mark on your file. Keeping existing repayments up to date also shows lenders you manage credit reliably.

Gather your paperwork

Having documents ready can speed things up once you find a home. Lenders commonly ask for photo ID, proof of address, recent payslips and bank statements. If you are self-employed, they will usually want accounts or tax calculations covering more than one year. Lenders will also want to see where your deposit has come from, so keeping a clear record of your savings helps.

Think about your budget beyond the mortgage

Owning a home brings costs that renters may not have faced before, such as buildings insurance, maintenance and, for some flats, service charges or ground rent. Building these into your budget gives a more realistic picture of what you can comfortably afford each month.

Step by step: from saving to getting the keys

1. Check your credit file. Look for errors, make sure you are on the electoral roll, and keep up any existing repayments.
2. Set your budget. Work out your deposit, likely borrowing and the extra costs above.
3. Get a mortgage in principle. This is a lender’s indication of how much it may lend, based on initial details. It is not a guaranteed offer.
4. Find a home and make an offer. Once it is accepted, instruct a conveyancer or solicitor.
5. Make your full mortgage application. The lender checks your documents in detail and arranges a valuation of the property.
6. Arrange a survey. This is optional but can flag problems before you commit.
7. Receive your mortgage offer. Read it carefully, including the rate, the term and any fees.
8. Exchange contracts. The purchase becomes legally binding, and you usually pay your deposit at this point.
9. Complete. The money moves to the seller’s side, and you get the keys.

After an offer is accepted, the legal and mortgage stages often take a few months, though chains and delays with searches can stretch this out.

Should you use a mortgage adviser?

You can apply for a first-time buyer mortgage directly with a bank or building society, or use a mortgage adviser (broker). A lender dealing with you directly can only offer its own products. An adviser may be able to compare deals across a number of lenders and help with the paperwork.

Advisers can be paid by lenders, by you, or both. It may be worth asking upfront how they are paid, whether they charge a fee, and whether they search the whole market or a selected panel of lenders. You can check that a firm is authorised on the FCA’s Financial Services Register.

What happens after you buy?

Many first-time buyers start on an initial deal that lasts for a set number of years. When it ends, your mortgage usually moves to the lender’s standard variable rate, which is often higher. At that point it may be worth looking at a new deal with your lender or another one. Our guide on when and why you might remortgage explains the options.

Scotland, Wales and Northern Ireland

• Scotland: Land and Buildings Transaction Tax (LBTT) applies instead of SDLT. First-time buyers may qualify for relief, with rates and thresholds set by Revenue Scotland.
• Wales: Land Transaction Tax (LTT) applies instead of SDLT. There is no first-time buyer relief in Wales, but the nil-rate band for main residential rates covers the first £225,000.
• Northern Ireland: SDLT applies, using the same rules and first-time buyer relief as England.

Shared Ownership and other home-buying schemes also have separate rules in each nation.

Summary

Getting a first-time buyer mortgage usually starts with a deposit of at least 5%, a clear budget and a tidy credit file. Understanding LTV, the help available and the full set of costs can make the process far more manageable, and knowing each step in advance helps you spot what is coming next.

Frequently asked questions

How do I get a mortgage as a first-time buyer?

Most first-time buyers start by saving a deposit, checking their credit file and working out a realistic budget. Next comes a mortgage in principle, which gives an idea of how much a lender may offer. Once an offer on a home is accepted, you make a full application, the lender values the property and, if everything checks out, issues a formal mortgage offer.

How much deposit does a first-time buyer need?

The typical minimum is 5% of the purchase price, so £12,500 on a £250,000 home. Some lenders and deals need 10% or more. A bigger deposit usually lowers your loan-to-value, which can open up a wider choice of mortgages and lower interest rates, though the right balance depends on your circumstances and what else you need cash for.

How long does it take to buy a first home?

There is no fixed timescale. Once an offer is accepted, the legal work, mortgage application, valuation and searches often take a few months to complete. Chains, slow searches or missing paperwork can stretch this out, while a chain-free purchase with documents ready may move faster. Saving the deposit beforehand is usually the longest part.

What costs should first-time buyers budget for?

Beyond the deposit, budget for legal (conveyancing) fees, searches, a survey, any mortgage product or broker fees, and moving costs. In England and Northern Ireland, first-time buyers pay no Stamp Duty on the first £300,000 of a home costing up to £500,000. Scotland and Wales have their own property taxes with different rules.

Should a first-time buyer use a mortgage adviser?

It is a personal choice. Some buyers go direct to a lender, while others use an adviser who can compare deals across a range of lenders and help with the paperwork. If you use one, it may be worth checking they are on the FCA’s Financial Services Register and asking upfront how they are paid and whether they charge a fee.

Sources

• GOV.UK – Stamp Duty Land Tax: residential property rates
• HM Treasury – Stamp Duty Land Tax: relief for first time buyers
• GOV.UK – Stamp Duty Land Tax
• GOV.UK – Who can open a Lifetime ISA
• GOV.UK – Withdrawing money from your Lifetime ISA
• HM Treasury – First Time Buyer ISA consultation
• HM Treasury – 2025 Mortgage Guarantee Scheme
• GOV.UK – Shared Ownership homes
• MoneyHelper – What mortgage can I afford?
• Welsh Government – Land Transaction Tax overview

This guide is general educational information only and is not regulated financial advice.