Mortgage Guide for First-Time Buyers

1. Who counts as a first-time buyer

A first-time buyer is someone who has never owned a property in the UK or abroad, whether fully or jointly, through inheritance, or with a mortgage. If you’re unsure, it’s worth checking – because first-time buyers often qualify for lower Stamp Duty rates and special schemes like First Homes, Shared Ownership, or a Lifetime ISA (LISA).

Even if you’ve owned a property overseas, you won’t typically be classed as a first-time buyer in the UK. Understanding your status early can help you plan and budget more accurately.

2. Checking what you can afford

Before you start viewing properties, it’s important to work out how much you can realistically borrow – and comfortably repay. Lenders assess your income, credit score, and existing commitments to calculate affordability.

Start by:

• Reviewing your monthly incomings and outgoings
• Using a mortgage calculator to estimate potential repayments
• Checking your credit score and improving it if needed

Setting a clear budget now can help you focus your search and avoid unnecessary stress later.

3. Saving for your deposit

Most lenders require at least a 5% deposit, though a higher deposit (10%–20%) can give you access to better mortgage rates.

It can take time to build up your deposit, so consider:

• Setting up an automatic savings transfer each month
• Reducing non-essential spending
• Using a Lifetime ISA, which adds a 25% government bonus to your savings (up to £1,000 a year)

Some buyers also receive a gifted deposit from family or use inheritance funds – both are accepted by most lenders with the right documentation.

4. Government schemes and support

There are several government-backed schemes designed to help first-time buyers get on the property ladder:

• First Homes Scheme: Buy a new-build property at 30–50% below market value (eligibility criteria apply).
• Shared Ownership: Purchase a share of a property (typically 25–75%) and pay rent on the remaining portion, with the option to increase your share over time (“staircasing”).
• Lifetime ISA (LISA): Save up to £4,000 per year and receive a 25% government bonus towards your first home.

Each scheme has its own criteria, so getting advice early can help you identify the best fit for your circumstances.

5. Choosing your mortgage type

Once you’ve saved your deposit, the next step is finding the right mortgage for you. There are different types of loans and interest options available:

• Repayment mortgage: You pay off both the loan and interest each month.
• Interest-only mortgage: You only pay the interest, with the loan repaid at the end of the term.
• Fixed-rate: Your interest rate stays the same for a set period, giving predictable monthly payments.
• Tracker or variable rate: Your interest rate moves in line with the Bank of England base rate.

A mortgage adviser can help you compare deals, explain fees, and ensure your mortgage fits your goals and budget – both now and in the future.

6. Costs beyond your mortgage

Remember, your mortgage isn’t the only cost involved in buying a home. Other expenses can include:

• Stamp Duty (reduced or exempt for first-time buyers under certain thresholds)
• Solicitor and conveyancing fees
• Mortgage arrangement and valuation fees
• Survey costs
• Insurance and protection
• Moving, furnishing, and decorating costs

Factoring these in early helps avoid surprises later on.

How we help you buy your first home

At Visionary Finance, we specialise in guiding first-time buyers through every step of the mortgage process – from initial budgeting to completion. We’ll help you:

• Understand your affordability and improve your mortgage readiness
• Access exclusive first-time buyer deals
• Navigate government schemes and lender criteria
• Manage the process from application to offer, keeping you informed throughout

Our aim is to make the process simple, clear, and stress-free – so you can focus on finding the right home, not fighting the paperwork.

First-time buyer mortgage FAQs