MORTGAGE First-Time Buyer's Complete Guide 2026
From saving a deposit to getting the keys — your step-by-step guide to buying your first home in the UK.
Key Takeaways
- 1Most lenders offer 4.5x your salary, but some stretch to 5.5x with larger deposits
- 2A 10% deposit is the sweet spot for good rates without requiring huge savings
- 3First-time buyers pay no stamp duty on properties up to £300,000
- 4Budget an extra 3-5% of property price for fees and moving costs
- 5Use a mortgage broker to access deals not available on the high street
The First-Time Buyer Journey
Buying your first home is one of the biggest financial decisions you'll make. This guide breaks down the process into manageable steps, with the tools you need at each stage.
Check affordability
Save deposit
Get mortgage
Find home
Complete
Step 1: Work Out What You Can Afford
Before you start browsing Rightmove, you need to know your budget. Two key numbers matter:
4.5x
Standard borrowing
Most lenders offer 4.5x your salary as standard
5-6x
Stretch borrowing
Some lenders offer higher multiples with larger deposits
Quick calculation:
On a £40,000 salary, you could borrow:
- • £180,000 (at 4.5x)
- • £200,000 (at 5x)
- • Add your deposit to get max property price
Calculate Your Borrowing Power
Enter your salary and deposit to see how much you could borrow:
Step 2: Save Your Deposit
Your deposit determines two things: how much you need to borrow, and the interest rate you'll get. Here's what to aim for:
5%
Minimum Deposit
Higher rates
10%
Sweet Spot
Good rates
15%+
Best Options
Lowest rates
Step 3: Budget for Stamp Duty
Good news: as a first-time buyer, you pay no stamp duty on the first £300,000 of your purchase. Here's how it works:
On a £350,000 property, you'd pay £2,500 (5% on the £50,000 above £300,000). Calculate yours →
Step 4: Get Your Mortgage Sorted
You have two main options:
1. Agreement in Principle (AIP)
Get an AIP before house hunting. It shows sellers you're serious and tells you exactly what you can borrow. Takes 24-48 hours.
2. Full Mortgage Application
Once your offer is accepted, submit a full application. The lender will value the property and make a formal offer.
Tip: Use a mortgage broker. They have access to deals you can't get directly and can save you money.
Government Schemes for First-Time Buyers
Mortgage Guarantee Scheme
Now permanent. Enables 95% LTV mortgages (5% deposit) with government backing. Available from most major lenders.
First Homes Scheme
30-50% discount on new-build homes. Income cap £80k (£90k in London). Limited availability.
Lifetime ISA
Save up to £4,000/year, government adds 25% bonus (up to £1,000/year). Must be aged 18-39 to open.
Calculate Your Monthly Payments
See what your mortgage would actually cost each month:
How Long Does It Take?
From offer accepted to keys in hand, expect 8-12 weeks on average:
Ready to start your journey?
Use our calculators to understand your numbers before speaking to lenders.