First-Time Buyer Guide | Your Remarkable Guide to Mortgages
Whether you’re buying your first home or have been through the process before, purchasing a property can feel complex, with many important steps to consider.
Our step-by-step house buying guide is divided into six clear sections. You can follow the full guide to gain a complete understanding of the journey—from saving for a deposit right through to moving into your new home. If you’ve bought before and only need help with certain areas, simply focus on the sections most relevant to you.
What is a Mortgage?
A mortgage is a type of loan used to purchase a home. It’s provided by a bank or building society.
You repay it over a set term, often 25 to 35 years, including interest.
The loan is secured against the property, so the lender can repossess it if payments stop.
Mortgages are common in the UK and allow homeownership without requiring the full purchase price upfront.
How to Get Ready for Your First Mortgage
Strong preparation can improve your chances of being accepted by lenders.
Step-by-Step Preparation:
Check your credit score — Get your file from Experian, Equifax or TransUnion. Correct any mistakes.
Reduce existing debts — Lower credit card balances and repay personal loans where possible.
Save for a deposit — Aim for at least 5–10% of the property’s price.
Gather documents — Collect payslips, P60S, utility bills, ID, and recent bank statements.
Set a budget — Calculate what you can afford to repay monthly.
Get mortgage advice — An adviser can find the most suitable options for your situation.
💡 Tip: Plan for solicitor fees, surveys, removals, and other one-off buying costs.
Different Types of Mortgages for First-Time Buyers
Mortgages come in various types, each with its own pros and cons. Select what suits your income and risk tolerance.
Fixed-Rate Mortgage
What is it? The interest rate stays the same for a fixed period, usually 2 to 5 years.
Pros: Monthly repayments stay consistent.
Cons: You won’t save if rates drop.
Tracker Mortgage
What is it? Follows the Bank of England base rate plus a set percentage.
Pros: Lower payments if the base rate drops.
Cons: Payments may increase if interest rates rise.
Interest-Only Mortgage
What is it? You only pay interest each month. The original loan must be repaid later.
Pros: Monthly payments are lower.
Cons: You need a separate plan to repay the full balance.
Standard Variable Rate (SVR)
What is it? Your lender’s default rate after an introductory deal ends.
Pros: No early repayment charges.
Cons: The rate can rise at any time.
Fixed vs. Variable Rate Mortgages: Pros & Cons
| Feature | Fixed Rate | Variable Rate |
|---|---|---|
| Monthly Payments | Stay the same | Can increase or decrease |
| Rate Impact | Not affected by interest rise | Affected by base rate changes |
| Budget Planning | Easier to plan ahead | Budgeting may be less predictable |
Most first-time buyers opt for fixed rates to ensure more predictable payments in the early years.
Preparing Your Finances
Lenders use strict checks to confirm affordability. Be prepared with documents and clear financial records.
What Lenders Look At:
Your income (employment or self-employment)
Monthly expenses (including loans and household bills)
Credit report and score
Size of deposit
Employment stability and history
Affordability under stress tests
Documents You’ll Need:
Passport or driving licence
Recent utility bills or council tax letters
Payslips or tax returns
Three months of bank statements
Evidence of deposit source
Finding the Right Lender or Mortgage Broker
Lender:
Offers mortgages directly
Only shows their own products
Mortgage Broker:
Searches across multiple lenders
Helps match a mortgage to your needs
💡 Tip: Brokers may access exclusive rates not available on the high street and handle all paperwork.
What is an Agreement in Principle?
An Agreement in Principle (AIP) gives a rough idea of how much you could borrow.
It’s not a formal offer, but it shows sellers and estate agents that you’re serious.
Helps during house viewings
May give you a competitive edge
Often leaves no trace on your credit file
Getting one is free, fast, and shows your budget range to sellers.
What Affects Your Mortgage Application?
Lenders assess:
Deposit amount
Credit file and payment history
Monthly income and outgoings
Job stability and contract type
Existing loans or financial obligations
Property type (leasehold or freehold)
Always give accurate information, mistakes could delay or weaken your application.
Questions to Ask Before Signing
Before accepting a mortgage offer, ask:
What is the total cost across the full term?
Are there early repayment charges?
What happens after the initial deal ends?
Are there product or arrangement fees?
Who manages the mortgage, and how do I contact them?
Understanding every cost and clause is essential before you proceed.
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FAQ: First-Time Buyer Guide
| Question | Answer |
|---|---|
| What is a first-time buyer? | A first-time buyer is someone purchasing their very first property and who has never owned a home before. In the UK, first-time buyers often benefit from specific mortgage products and government schemes designed to make getting on the property ladder more accessible. |
| How much deposit do I need for my first home? | Most first-time buyers need a deposit of at least 5% to 10% of the property price. However, a larger deposit can help you secure better mortgage rates and reduce your monthly repayments. A qualified mortgage adviser can help you compare your options. |
| Can I get a mortgage with a small deposit? | Yes. There are lenders who offer 95% loan-to-value mortgages, which means you only need a 5% deposit. Government-backed schemes like the Mortgage Guarantee Scheme can also support buyers with smaller savings. |
| What is an Agreement in Principle (AIP)? | An Agreement in Principle, or AIP, is a statement from a lender confirming how much they may be willing to lend you, based on your income and credit history. It’s not a formal offer but is useful when making property offers. |
| Do first-time buyers pay Stamp Duty? | In England and Northern Ireland, first-time buyers do not pay Stamp Duty on properties up to £425,000. If the property price is between £425,001 and £625,000, you’ll pay Stamp Duty on the amount above £425,000. Rules differ slightly in Scotland and Wales. |
| What documents do I need to apply for a mortgage? | You’ll usually need recent payslips, bank statements, proof of ID, proof of address, and details of any existing loans or credit commitments. Self-employed applicants may also need tax returns or accounts. |
| What if I have a low credit score? | A lower credit score doesn’t automatically mean you can’t get a mortgage. Some lenders specialise in helping first-time buyers with less-than-perfect credit. An adviser can help identify which lenders are most likely to accept your application. |
| Should I choose a fixed or variable mortgage? | A fixed-rate mortgage keeps your repayments the same for a set period, which can help with budgeting. A variable or tracker mortgage may offer flexibility but can rise or fall with interest rate changes. Your adviser can help you choose based on your priorities. |
| Can I use government help schemes? | Yes. Depending on your situation, you may qualify for schemes like Shared Ownership, First Homes, or the Mortgage Guarantee Scheme. Each has its own criteria, so it’s worth checking which one best fits your needs. |
| Why use a mortgage adviser as a first-time buyer? | A mortgage adviser can compare hundreds of lenders to find the best deal for your circumstances, explain the process in plain language, and manage your application from start to finish. This saves you time and reduces the risk of costly mistakes. |