First time buyers guide

In addition to saving for a deposit, it’s essential to understand whether you can manage the monthly mortgage payments. As a first-time buyer, the key question is: can you afford this commitment? Start by reviewing your current expenses and creating a budget before you begin house hunting.

There are plenty of free online tools to help you estimate what you can realistically afford each month. Budget planners from Money Helper and Money Saving Expert are great places to start.

Lenders will also assess your ability to repay the mortgage. They’ll carry out a ‘stress test’ to see if you could still make payments if interest rates rise or your financial situation changes. You’ll need to provide evidence of your income and outgoings as part of this process.

If you're employed

If you're employed by a company, you should receive weekly or monthly payslips. When applying for a mortgage, you’ll typically need to provide at least three months’ worth of payslips. If your income includes overtime or commission, lenders may ask for up to twelve months’ worth, along with your most recent P60.

If you're self-employed or a contractor

Getting a mortgage when you're self-employed or working as a contractor can be more complex, as you'll need to demonstrate your income. This is usually done in one of the following ways:

• Business Accounts: Most lenders require two to three years of accounts, ideally signed off by a Chartered or Certified Accountant.

• Tax Returns: If you don’t have formal accounts, two to three years of tax returns can serve as an alternative.

• Contracts: Providing evidence of current and past short- or long-term contracts can also support your application.

Keep in mind that lenders assess your profits, not your turnover. For more detailed guidance, check out our self-employed mortgages guide.

Save for your deposit before you start viewing homes

Before booking viewings for your home, it’s important to have your deposit ready—typically at least 5% of the property’s value.

For example, if you're looking at a £200,000 home, you’ll need a minimum deposit of £10,000. However, saving more than 5% can open the door to a wider range of mortgage options and better interest rates.

Golden rule:
A bigger deposit = better mortgage rate = lower monthly repayments.

Even a small increase in your deposit can make a noticeable difference. For instance, moving from a 5% to a 10% deposit can reduce your monthly payments. The next key thresholds are 25% and 40%, so if you can stretch to the next band, it’s worth considering.

Support from family

Many first-time buyers get help from parents or grandparents—often referred to as the “Bank of Mum and Dad.” But support doesn’t always have to be a cash gift. There are several ways family members can assist, including acting as guarantors or offering a loan.

Don’t forget the fees

Before submitting your mortgage application, make sure you’re aware of additional costs such as arrangement fees, valuation fees, and legal costs. These are separate from your moving expenses. You might choose to keep part of your deposit aside to cover them, or in some cases, add them to your mortgage. If the fees are refundable, you won’t lose money if the mortgage doesn’t go ahead.

Be aware of additional fees before applying!

Before submitting your mortgage application, it’s important to factor in fees beyond your moving costs. You might consider setting aside part of your deposit to cover these. In some cases, fees can be added to your mortgage—so if your application doesn’t go ahead, and the fees are refundable, you won’t be out of pocket.

Common mortgage fees

• Application/Arrangement Fee: charged by some lenders to process your mortgage application and set up your account. This fee is often refundable if the mortgage doesn’t complete and can usually be added to your mortgage.

• Booking or Reservation Fee: A separate fee to secure a specific mortgage deal (e.g. fixed-rate or tracker). This is always paid upfront and is non-refundable. Some lenders include this in the arrangement fee.

• Valuation Fee: Covers the cost of a basic property valuation to ensure it’s suitable security for the loan. The fee is based on the property’s value. While this valuation is primarily for the lender, you’ll usually receive a copy. Some mortgage deals include a free valuation, but more detailed reports may incur extra charges.

Other costs to consider when buying a home

Beyond your monthly mortgage payments, there are several other costs to plan for:

• Survey costs

• Solicitor’s fees

• Removal costs

• Buildings insurance

• Initial furnishing and decorating

• Stamp Duty - see the gov.uk website to calculate how much you'll need to pay.  

Choosing the right mortgage for you

With so many mortgage types, interest rate options, and repayment methods available, figuring out which one suits you best can feel overwhelming. The right choice depends on your personal circumstances, so it’s a good idea to do some research and speak with an independent mortgage adviser to get tailored advice.

While comparison websites and lender platforms are useful for browsing deals, they won’t tell you whether a particular mortgage is right for your situation—or if a lender is likely to approve your application.

Explore affordable home-buyer schemes

Government-backed schemes like Shared Ownership are designed to help first-time buyers get on the property ladder with smaller deposits. These schemes can make homeownership more accessible, but remember: even with support, lenders will still assess whether you can afford the mortgage repayments.

Making sure you can afford a mortgage and having a deposit is just the start - affordability and credit checks play a part in assessments of whether they you will get a mortgage. Not every lender will view you in the same way, but there are several things you can do to get in top mortgage shape.

Your lender has a responsibility to ensure that you can afford the mortgage you're asking for. Don’t be worried that the mortgage application form seems very detailed, it's all about working out how much you've got coming in, how much you've got going out, and what you can afford to pay.

You will need to provide:

• Proof of identity for example; photo driving licence, passport, birth certificate and your national insurance number (it will depend on what the relevant lender requests)

• Proof of address for the last three years, such as utility or council tax bills (if relevant)

• Employment details and contact number

• Proof of income such as payslips, P60, self-employed accounts (two to three years and approved by a chartered accountant), SA302s.

• Proof of bonuses and commission

• Proof of deposit (plus written confirmation from donor — typically parents — if getting a gift towards the deposit that it really is a gift & not a loan)

• Outgoings including debts and loans

• Your last three months bank statements

• Details of assets such as other accounts, properties, investments, etc.

Your lender will also need to be comfortable with the property you want to buy.

Some lenders won’t lend on homes near commercial premises, those without a working kitchen or bathroom (even if you plan to refurbish), or those in a high rise. So ensure you declare everything on your application form.  

The purchasing details you will need to provide include:

• Which property you wish to buy (address and details)

• Contact details for your solicitor/conveyancer

• Your valuation/survey requirements

• Your bank account (if not with the lender)

Your lender will then arrange for a surveyor to conduct a valuation of the property you wish to buy. During this period, the lender will also be processing the rest of your application. This will involve processing fees, chasing outstanding documents and checking all details. It is vital that each and every piece of information you put on a mortgage application form is correct, otherwise it could cause delays or even your application to be declined.

Once the lender has finished processing your application, and if they are happy with the application and valuation, they will extend a formal offer to you. If you accept, they will send a copy to your solicitor.

Then the exchange of contracts can take place. The funds will be sent to your solicitor, who will conclude the transaction with the seller, and the property will finally be yours! This is known as the completion date. The keys to your new home will change hands, and you can move in.

Congratulations – you are now a homeowner!