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What You Need to Know as a First-Time Buyer in the UK

First-time buyer? This guide covers deposits, stamp duty, mortgage types and hidden costs. Written by Will Sharman of Mortgage Brokers Near Me, it explains the process step-by-step and shows how we can help you buy with confidence.

Will Sharman

Jul 28, 2025

Mortgage broker explaining fixed and tracker mortgages to first-time buyers.

Getting Started What Makes Buying Your First Home Different?

As a first-time buyer, you don’t have a property to sell, which often makes you a more attractive buyer to sellers and estate agents. But you’ll also face new challenges:

Understanding deposit requirements and stamp duty rules.
Learning how mortgage affordability is calculated.
Navigating legal checks and conveyancing for the first time.

By preparing early, especially around your deposit and credit profile you’ll save time and avoid unnecessary stress later.

How Much Deposit Do You Really Need?

Most first-time buyers put down at least 10% of the property value, but there are mortgages available with deposits as low as 5%. The bigger your deposit, the better your mortgage rate and the lower your monthly payments will be.

Standard deposit sizes

5% deposit: Minimum entry level. More lenders are now offering 95% loan-to-value (LTV) deals.
10% deposit: Widely available, often better rates than 5% deposits.
20% deposit: Unlocks some of the lowest rates in the market.

Boosting your deposit with government help

If you’re struggling to save, the Lifetime ISA (LISA) offers a 25% government bonus on savings up to £4,000 per year. That means an extra £1,000 annually toward your deposit if you qualify.

Set a realistic budget using our mortgage calculator to see what you can comfortably afford.

"We’ve helped countless first-time buyers secure their first home, and the same thing always happens – the moment they get that Mortgage in Principle, the process starts to feel real and exciting." – Will Sharman

Understanding Stamp Duty for First-Time Buyers

Stamp Duty Land Tax (SDLT) is a tax you pay when buying property. As a first-time buyer, you benefit from reduced rates.

Current first-time buyer relief (England):

0% on the first £300,000
5% on the portion between £300,000 and £500,000
Normal rates apply if the property costs over £500,000

Example:
For a £350,000 home, you’ll pay 0% on the first £300,000 and 5% on the remaining £50,000 a total of £2,500.

Knowing this upfront helps you budget and avoids last-minute surprises. Factor in future costs like protection – our mortgage protection services can help here.

Mortgage Options Explained: Fixed, Tracker & Variable

Mortgages come in a few main flavours. Here’s what first-time buyers need to know:

Fixed-rate mortgages

The interest rate stays the same for 2–5 years (sometimes longer).
Great for budgeting as your monthly payment won’t change.
Popular with first-time buyers who want certainty.

Tracker mortgages

The rate moves in line with the Bank of England base rate.
Can be cheaper initially, but payments may rise if interest rates increase.
Works well if you’re comfortable with some fluctuation.

Standard variable rate (SVR)

The lender’s default rate once your fixed/tracker deal ends.
Usually higher and less predictable most people remortgage before reaching SVR.

Tip: If you’re unsure which suits you, a broker can compare the numbers based on your deposit, income and how long you plan to stay in the property. Once your fixed term ends, you may look at a remortgage to keep costs low.

Beyond the Deposit; Costs You Might Not Expect

Saving for a deposit is only part of the picture. Here are other costs first-time buyers often forget:

Conveyancing fees: Legal work for the purchase, usually £900–£1,500 plus disbursements.
Surveys: £300–£1,000 depending on the level of detail.
Mortgage fees: Arrangement, booking or valuation fees, sometimes added to the loan.
Stamp duty: As outlined earlier.
Moving costs: Removals, van hire and storage factor in at least a few hundred pounds.
Insurance: Buildings insurance is compulsory; contents insurance is optional but wise.
Council tax and utilities: Set these up from completion day to avoid gaps.

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First time buyer getting the keys to their house

Government Schemes to Help First-Time Buyers

There are several schemes worth checking:

Shared Ownership: Buy a share of a property and pay rent on the rest, with the option to increase your share later.
Mortgage Guarantee Scheme: Supports 95% mortgages by giving lenders extra security.
First Homes Scheme: Discounted homes for local first-time buyers and key workers.

Each has eligibility criteria, so it’s worth speaking to a broker to see if you qualify.

Preparing Your Finances and Credit Score

Mortgages come in a few main flavours. If you’re weighing up whether to go direct to your bank or use a broker, our guide on mortgage broker vs bank breaks down which option gives better value in 2025.. Before applying:

Check your credit report with Experian, Equifax or TransUnion.
Pay bills on time and avoid new debt in the months leading up to your application.
Reduce existing credit card balances where possible.

These steps can make the difference between getting the rate you want and paying more than you need to.

Step-by-Step Process to Buying Your First Home

Here’s what the journey usually looks like:

1. Save your deposit and check affordability

Set a realistic budget and speak to a broker to understand what you can borrow.

2. Get a Mortgage in Principle

This shows estate agents you’re serious and gives you a clear price range.

3. House hunting and viewing

Shortlist properties, view them at different times of day, and check for potential issues like damp or outdated electrics.

4. Make an offer and negotiate

Don’t be afraid to offer below asking price, especially if the property has been on the market for a while.

5. Appoint a solicitor and start conveyancing

Your solicitor handles legal checks, searches and contracts.

6. Finalise your mortgage

Submit a full application and arrange any required surveys or valuations.

7. Exchange and completion

Contracts are signed, funds are transferred, and you get the keys to your first home.

Common Mistakes First-Time Buyers Make (and How to Avoid Them)

Forgetting to budget for additional costs beyond the deposit.
Overstretching finances by focusing on the maximum loan available.
Not understanding leasehold vs freehold differences.
Skipping surveys to save money (can cost more later).

Life After Completion, What to Plan For

Owning a home doesn’t end with getting the keys. Plan for:

Ongoing maintenance and repairs (e.g., boiler servicing, roof checks).
Setting aside savings for emergencies.
Reviewing your mortgage deal before it ends to avoid moving onto a high SVR.

FAQs About First-Time Buyer Mortgages

Do first-time buyers always get stamp duty relief?
No, relief applies up to £500,000 purchase price. Anything higher follows standard rates.

How long does it take from offer to completion?
Typically 8–12 weeks, though it can be quicker or slower depending on the chain.

Is it better to buy a new build or an older property?
New builds can mean lower maintenance but may come with leasehold restrictions. Older properties offer character but can need more work.

Happy first-time buyers celebrating after securing their first home.

"One of the biggest wins for our first-time buyers is realising they don’t have to do this alone – once they see the numbers clearly laid out, everything suddenly feels achievable." – Will Sharman

Ready to Start Your Journey?

Buying your first home doesn’t need to be overwhelming. At Mortgage Brokers Near Me, we help first-time buyers every day from explaining your options in plain English to finding the best mortgage deal for your situation.

Ready to get started? Get in touch here and let’s talk through your plans.

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