How much deposit do I need to buy my first home in the UK?

First-time buyers typically need a 5-10% deposit, though 15-20% unlocks much better mortgage rates. On a £250,000 property, that's £12,500 (5%) to £50,000 (20%). Government schemes like the Mortgage Guarantee Scheme support 95% mortgages (5% deposit) on properties up to £600,000. Lifetime ISAs give you a 25% government bonus on savings up to £4,000/year toward your first home (maximum £450,000 property). While 5% deposits are possible, higher deposits mean lower interest rates, smaller monthly payments, and better lender choice.

What is stamp duty and do first-time buyers have to pay it?

Stamp Duty Land Tax (SDLT) is a tax on property purchases in England and Northern Ireland. First-time buyers get relief: pay nothing on properties up to £425,000, then 5% on the portion from £425,001-£625,000. For example, a £400,000 first home has zero stamp duty (saving £10,000 vs. non-first-time buyers). Above £625,000, you pay standard rates and lose first-time buyer relief. Scotland and Wales have different systems (LBTT and LTT) with their own first-time buyer benefits. This relief can save you £11,250 on a £500,000 property.

How much can I borrow on a mortgage?

Lenders typically offer 4-4.5 times your annual gross salary, though some specialist lenders go up to 5-6 times. On a £40,000 salary, expect to borrow £160,000-£180,000. Couples combine incomes: £40,000 + £35,000 = £75,000, borrowing £300,000-£337,500. Lenders also stress-test affordability against your monthly outgoings, debts, and living costs. Credit score matters - better scores access higher multiples. Self-employed applicants may face stricter criteria. Use our mortgage borrowing calculator to see your realistic budget based on your income and deposit.

What credit score do I need to get a mortgage?

There's no minimum credit score, but lenders prefer scores above 700 (Experian) or 800 (Equifax). Higher scores access better interest rates. To improve your chances: register on the electoral roll (+50 points), pay all bills on time for 6+ months, keep credit utilization below 25%, avoid payday loans, and don't make multiple credit applications in short succession. Check your credit report 3-6 months before applying - dispute any errors. Even with poor credit, specialist lenders exist but expect higher interest rates. Building credit history by using a credit card responsibly helps significantly.

Should I use a mortgage broker or go directly to a lender?

Mortgage brokers are usually worth it, especially for first-time buyers. They access deals unavailable directly, do the paperwork legwork, and find the best rate for your situation. Many brokers charge nothing (earning commission from lenders) or £300-£500. They're particularly valuable if you're self-employed, have a small deposit, adverse credit, or buying an unusual property. However, some lenders (like HSBC, Nationwide) only deal directly. Best approach: use a whole-of-market broker who checks 90+ lenders, then also check direct-only lenders yourself. The rate difference can save thousands over the mortgage term.

What's the difference between a mortgage in principle and a full mortgage offer?

A Mortgage in Principle (Agreement in Principle/Decision in Principle) is a conditional statement from a lender indicating they'll likely lend you a specific amount, based on basic information. It typically lasts 60-90 days, involves a soft credit check, and helps when making offers (shows sellers you're serious). A Full Mortgage Offer comes after property surveys, full income verification, and hard credit check. It's the formal lending commitment. Get a mortgage in principle before house hunting. Once your offer is accepted, apply for the full mortgage offer - this can take 2-4 weeks. The full offer is legally binding.

What fees and costs should I budget for when buying a house?

Beyond your deposit and stamp duty, budget £3,000-£8,000+ for: mortgage arrangement fees (£0-£2,000), valuation fee (£250-£1,500), homebuyer survey (£300-£600) or full structural survey (£600-£1,500), solicitor fees (£850-£1,500), searches (£250-£400), electronic transfer fees (£40-£60), mortgage broker fee (£0-£500), buildings insurance (£150-£300/year), and removal costs (£400-£1,500). First-time buyers often underestimate - save 3-5% of property price for fees. Moving into a £250,000 house realistically requires £12,500 deposit + £5,000-£10,000 fees + furniture/repairs budget.

How long does the house buying process take in the UK?

From offer acceptance to completion typically takes 8-12 weeks, though it can stretch to 16+ weeks if there are issues. Timeline: find property (varies!), make offer (1 day), mortgage application (2-4 weeks), property survey (1-2 weeks), conveyancing/searches (4-8 weeks), exchange contracts (1 day), completion (typically 1-2 weeks after exchange, sometimes same day). Delays happen with: slow solicitors, problematic surveys, property chains, or title issues. Being a first-time buyer with no onward chain is actually an advantage. Having your mortgage in principle and finances ready accelerates the process significantly.

Should I get a fixed or variable rate mortgage?

Most first-time buyers choose fixed-rate mortgages for payment certainty and protection against rate rises. Common terms: 2-year fixes (cheapest rates, but you'll need to remortgage sooner), 5-year fixes (longer security), or 10-year fixes (maximum certainty). Variable rates (tracker, standard variable rate, discount) can go up or down with Bank of England base rate - lower initial payments but unpredictable. In 2026, with rates at 4-6%, many opt for 5-year fixes. Consider: how long you'll stay in the property, your risk tolerance, and your budget flexibility. Always compare total cost over the initial period, including arrangement fees.

What happens on completion day?

Completion is when you get the keys and the property legally becomes yours. Your solicitor transfers the remaining money to the seller's solicitor (usually by 12-1pm). Once funds clear and paperwork is confirmed (typically 1-3pm), the estate agent releases keys. You're now legally responsible for the property, buildings insurance, and mortgage payments. Completion day tips: take the day off work, arrange utilities switchover in advance, have movers booked, keep your solicitor's phone number handy, and celebrate once you have the keys! The property is officially yours. Most completions happen Friday so you have the weekend to move in and settle.

First-Time Buyer Guide UK 2026 - Complete House Buying Process

Buying your first home is one of life's biggest financial milestones. It's exciting, overwhelming, and often confusing - especially navigating the UK property market with its unique terminology, processes, and government schemes. This comprehensive guide walks you through every step of the first-time buyer journey, from saving your deposit to getting the keys to your new home. Whether you're just starting to save or ready to make an offer, this guide has you covered.

📋 First-Time Buyer Checklist

□Save 5-20% deposit

□Check credit score (aim 700+)

□Budget for fees (£3,000-£8,000)

□Get Mortgage in Principle

□Find solicitor/conveyancer

□Research areas and properties

□View properties (10-20+)

□Make offer and negotiate

💷Step 1: Save Your Deposit

Your deposit is the upfront payment you make when buying a property. The larger your deposit, the better your mortgage rate and the lower your monthly payments. Here's what you need to know:

Deposit Requirements in 2026:

5%Minimum deposit - Available through Mortgage Guarantee Scheme, but higher interest rates (5.5-6%). On £250k property = £12,500
10%Common first-time buyer deposit - Better rates (4.5-5.5%). On £250k property = £25,000
15%Sweet spot for rates - Significantly better rates (4-4.5%). On £250k property = £37,500
20%Excellent rates - Best standard mortgages (3.8-4.2%). On £250k property = £50,000

Government Schemes to Help You Save:

Lifetime ISA (LISA)

Save up to £4,000/year, government adds 25% (max £1,000/year). Use toward first home under £450,000 or after age 60. Start at 18-39, contribute until 50. A £16,000 deposit only costs you £12,800 over 4 years!

Mortgage Guarantee Scheme

Helps you get 95% mortgages (5% deposit) on properties up to £600,000. Government guarantees the loan, reducing lender risk. Available through major banks and building societies.

Shared Ownership

Buy 25-75% of a property, pay rent on the rest. Lower deposit needed (typically 5-10% of your share). Can increase ownership over time (staircasing). Good if you can't afford full market value.

Use our savings calculator to see how long it will take to save your deposit based on your monthly contribution.

🏠Step 2: Work Out What You Can Afford

Before falling in love with properties beyond your budget, understand what you can realistically afford. This means both what lenders will offer AND what you can comfortably pay monthly.

How Much Can You Borrow?

Lenders typically offer 4-4.5 times your annual gross salary. Some specialist lenders go up to 5-6 times for high earners with excellent credit.

£30,000 salary:Borrow £120,000-£135,000

£40,000 salary:Borrow £160,000-£180,000

£50,000 salary:Borrow £200,000-£225,000

£60,000 salary:Borrow £240,000-£270,000

Couple (£40k + £35k):Borrow £300,000-£337,500

Add your deposit: £180,000 mortgage + £20,000 deposit = £200,000 property budget

Affordability Assessment

Lenders don't just look at income multiples. They stress-test your budget by checking:

• Monthly outgoings (bills, food, transport, childcare)
• Existing debts (credit cards, loans, car finance)
• Credit commitments (even unused credit card limits count)
• Can you still afford payments if rates rise 2-3%?

Calculate your exact mortgage borrowing capacity with our mortgage borrowing calculator.

📍Step 3: The Buying Process Timeline

Understanding the house buying timeline helps you prepare and avoid delays. From offer to keys typically takes 8-12 weeks, though it can be longer.

Get Your Finances in Order (Before Searching)

Check credit score, save deposit, obtain Mortgage in Principle. This shows estate agents and sellers you're a serious buyer.

Find Your Property (2 weeks - 6 months)

View properties on Rightmove, Zoopla, OnTheMarket. Attend viewings (expect 10-20+). Research the area, local schools, transport links, and future developments.

Make Your Offer (1-3 days)

Submit offer (typically 5-10% below asking price). Negotiate. Once accepted, instruct solicitor immediately. Offer is not legally binding until contracts are exchanged.

Apply for Full Mortgage (2-4 weeks)

Submit full mortgage application with payslips, bank statements, ID. Lender conducts property valuation. Chase lender if it drags on.

Property Survey (1-2 weeks)

Book Homebuyer Report (£300-£600) or Full Structural Survey (£600-£1,500) for older properties. Survey reveals issues - use major problems to renegotiate price.

Conveyancing and Searches (4-8 weeks)

Solicitor conducts local authority searches, environmental searches, water searches, and checks title deeds. This stage often causes delays - chase your solicitor weekly.

Exchange Contracts (1 day)

You and seller sign identical contracts. Pay 10% deposit (not your mortgage deposit - this is part of the purchase). Legally binding from this point - no backing out without losing deposit.

Completion Day (1-2 weeks after exchange)

Remaining funds transfer to seller. Once confirmed (usually 1-3pm), you get the keys! Property is legally yours. Celebrate - you're a homeowner!

💰Step 4: Budget for All the Costs

Your deposit isn't the only cost. First-time buyers are often shocked by how much you need beyond the deposit. Here's everything you'll pay:

Complete Cost Breakdown for First-Time Buyers:

Stamp Duty (SDLT)

First-time buyer relief: £0 up to £425k, then 5% on £425k-£625k

£0-£10,000

Mortgage Arrangement Fee

Can be added to mortgage but costs more long-term

£0-£2,000

Property Valuation

Required by lender (often free with mortgage deal)

£0-£1,500

Homebuyer Survey

Recommended to identify problems before buying

£300-£600

Solicitor/Conveyancer Fees

Legal work, searches, Land Registry fees included

£850-£1,500

Searches

Local authority, drainage, environmental checks

£250-£400

Mortgage Broker Fee

Many are free (commission from lender)

£0-£500

Buildings Insurance

Required from exchange, annual cost

£150-£300

Removal Costs

Professional movers or van hire

£400-£1,500

Typical Total (Excluding Deposit & Stamp Duty)

£3,000-£8,000

💡 Top Tips for First-Time Buyers

•Be mortgage-ready before viewing: Mortgage in Principle makes you a more attractive buyer
•View properties multiple times: Different times of day, with different people, check neighbors
•Don't skip the survey: £500 survey could save you £10,000s on hidden problems
•Being chain-free is your advantage: Sellers prefer first-time buyers with no property to sell
•Budget for ongoing costs: Council tax, utilities, maintenance, repairs - add 1% of property value/year
•Chase your solicitor weekly: Conveyancing delays are common - be proactive

Calculate Your Mortgage Costs

Use our free mortgage calculator to see your monthly payments, total interest, and affordability based on different deposit sizes and interest rates.

Mortgage Calculator →How Much Can I Borrow? →

The Complete First-Time Home Buyer Guide for the UK (2026)