The Latest First-Time Buyer's Guide to Mortgages

Buying your first home is one of the most significant financial decisions you'll ever make. The mortgage process can feel overwhelming — but it doesn't have to be. This guide walks you through everything step by step.

Step 1: Check Your Credit Score

Your credit score is the first thing a lender looks at. It determines whether you'll be approved and at what interest rate. Before applying for any mortgage:

• Check your score with Experian, Equifax, or TransUnion
• Pay off existing debts or reduce credit card balances
• Avoid new credit applications in the 6 months before applying
• Register on the electoral roll at your current address
• Correct any errors on your credit file immediately

Step 2: Save Your Deposit

Most lenders require a minimum deposit of 5–10% of the property value. However, the more you save, the better the deal you'll get.

• 5% deposit: Possible but highest interest rates
• 10% deposit: Better rates, wider choice of lenders
• 20%+ deposit: Best rates available (LTV under 80%)

Step 3: Calculate What You Can Afford

Most lenders will offer 4–4.5x your annual income. For a joint application, they combine both salaries. Use our calculator to model realistic scenarios before approaching lenders.

Step 4: Get a Mortgage in Principle

A Mortgage in Principle (MIP) is a conditional agreement from a lender showing how much they'd lend you. Estate agents and sellers often require this before accepting offers. It doesn't affect your credit score if done via a soft check.

Step 5: Choose the Right Mortgage Type

Fixed Rate

Your interest rate stays the same for the fixed term (typically 2, 3, or 5 years). Ideal if you want predictable monthly payments and protection from rate rises.

Variable Rate / Tracker

Your rate moves with the Bank of England base rate. Payments can go up or down — riskier but potentially cheaper when rates fall.

Step 6: Factor in All the Costs

Your mortgage payment is just one part of owning a home. Budget for:

• Stamp Duty: First-time buyers get relief on properties up to £625,000
• Solicitor fees: £1,000–£2,500
• Survey costs: £500–£1,500
• Buildings insurance: Required by most lenders from day one
• Ongoing costs: Council tax, utilities, maintenance

Step 7: Compare Lenders

Don't just go to your bank — compare at least 3–5 lenders. Use a whole-of-market mortgage broker to access deals not available directly. Broker fees are often offset by the better rates they find.