First Time Buyer Mortgage UK - Your Complete Guide
A first time buyer mortgage is designed specifically for people purchasing their first home. As a first-time buyer in the UK, you have access to special benefits including stamp duty relief, competitive interest rates, and government schemes. Use our mortgage calculator to see what you could afford.
Who Counts as a First-Time Buyer?
You're a first-time buyer if you've never owned a property anywhere in the world. This includes:
- ✓ Never owned a residential property (freehold or leasehold)
- ✓ Never inherited a property
- ✓ Never owned property abroad
- ✗ Previously owned but sold - you're NOT a first-time buyer
First Time Buyer Mortgage Benefits
Stamp Duty Relief
Pay no stamp duty on properties up to £425,000, saving up to £8,750 compared to other buyers.
Lower Deposit Options
Many lenders offer mortgages with just 5% deposit for first-time buyers, with competitive rates.
Government Schemes
Access to schemes like Lifetime ISA, First Homes, and shared ownership to help you buy sooner.
Competitive Rates
Many lenders offer special first-time buyer products with attractive interest rates.
First Time Buyer Stamp Duty Relief
First-time buyers benefit from enhanced stamp duty relief on properties up to £625,000:
| Property Price | First-Time Buyer | Standard Rate | You Save |
|---|---|---|---|
| £250,000 | £0 | £0 | £0 |
| £350,000 | £0 | £5,000 | £5,000 |
| £425,000 | £0 | £8,750 | £8,750 |
| £500,000 | £3,750 | £12,500 | £8,750 |
| £625,000 | £10,000 | £18,750 | £8,750 |
Use our stamp duty calculator for an instant calculation based on your property price.
First Time Buyer Schemes
Lifetime ISA (LISA)
Save up to £4,000 per year and receive a 25% government bonus (up to £1,000) to use towards your first home purchase (property up to £450,000).
Must be aged 18-39 to open, and property must cost £450,000 or less.
Shared Ownership
Buy a share (25-75%) of a home and pay rent on the rest. Allows you to get on the ladder with a smaller deposit and mortgage.
Household income must be £80,000 or less (£90,000 in London).
First Homes Scheme
Buy new-build homes at a discount of at least 30% compared to market value. The discount passes on to future buyers.
Household income up to £80,000 (£90,000 in London). Discounted price must be no more than £250,000 (£420,000 in London).
95% Mortgage Guarantee
Government-backed scheme allowing lenders to offer 95% LTV mortgages with competitive rates, meaning you only need a 5% deposit.
Available from participating lenders. Property must be your main residence.
Top Tips for First Time Buyers
1. Start Saving Early
Open a Lifetime ISA as soon as possible to maximise the government bonus. Even small regular contributions add up over time.
2. Check Your Credit Score
Review your credit report 6-12 months before applying. Fix any errors and avoid new credit applications in the run-up to your mortgage application.
3. Get a Decision in Principle
Before house hunting, get a mortgage decision in principle. It shows sellers you're serious and helps you know your budget.
4. Budget for All Costs
Factor in solicitor fees (£1,000-2,000), surveys (£300-700), moving costs, and furnishing. These add thousands to your purchase.
5. Consider Location Flexibility
Expanding your search area could get you more for your money. Look at transport links and up-and-coming areas.
6. Use a Mortgage Broker
Brokers can access deals not available directly and guide you through the process. Many are free as they're paid by lenders.
First Time Buyer Mortgage FAQs
How much deposit do I need as a first-time buyer?
Most lenders accept 5-10% deposits from first-time buyers, with some offering special 5% mortgage products. A larger deposit (15%+) will unlock better interest rates and reduce your monthly payments.
Can I use gifted deposits?
Yes, most lenders accept gifted deposits from family members. They'll need to sign a letter confirming the gift doesn't need to be repaid. Some lenders have restrictions on gifted deposits.
What documents do I need for a mortgage application?
Typically: 3 months' payslips, 3 months' bank statements, proof of ID and address, P60, and details of any debts. Self-employed applicants need 2-3 years' accounts or tax returns.
How long does the first-time buyer mortgage process take?
From application to completion usually takes 8-12 weeks, but can be longer if there are issues with the property or chain. Having documents ready speeds things up.
Should I get a fixed or variable rate mortgage?
Most first-time buyers choose fixed rates for predictable payments while settling into homeownership. 2-year fixes are popular, but 5-year fixes offer longer certainty.
Can I buy with a partner who already owns property?
Yes, but you'll lose first-time buyer benefits. The transaction will be assessed based on the non-first-time buyer, so you'll pay standard stamp duty rates.
Essential First Time Buyer Tools
Summary
A first time buyer mortgage offers significant advantages including stamp duty relief, access to government schemes, and competitive rates. Start by checking how much you could borrow, then use our mortgage calculator to see monthly payments. With careful planning and the right support, getting on the property ladder is achievable. Speak to a mortgage broker to explore all your options.