Buying your first home is a big step, and the process can feel complicated: mortgages, deposits, government schemes, solicitors and surveys, all at once. It doesn't need to be.
This guide covers what first time buyers in the UK need to know, from working out whether you qualify and which government schemes are open to you, through to the mortgage application, the legal work and the costs people forget to budget for. Whether you're just starting to save or ready to start viewing properties, you'll find the practical detail here. If you'd rather just talk it through, our first time buyer advisers are happy to help.
Your first time buyer status matters because it decides which government schemes and stamp duty relief you can use, and those can be worth thousands of pounds.
You are a first time buyer if you have never owned a property before, anywhere in the world. That definition is stricter than most people expect, and it applies globally, not just in the UK. It also covers property you owned jointly with someone else, and property you inherited and became the legal owner of.
If you're buying with someone else, you both need to be first time buyers. If your partner has owned a property before, the purchase loses first time buyer treatment even if you have never owned one yourself.
Once you have owned any property, you don't get first time buyer status back, even after you sell it. That applies to residential, commercial and overseas property alike.
You're a first time buyer if all of these are true:
If all of those are true, the schemes and reliefs in this guide are open to you.
Every purchase is different, but almost every first time buyer goes through the same eight stages.
1. Work out your budget. Before viewing anything, work out what you can borrow and what deposit you'll need. Most lenders want at least 5%, and a bigger deposit opens up better rates. Budget for legal fees, a survey, stamp duty and moving costs as well as the deposit. Our borrowing calculator gives you a rough figure; an adviser will give you an accurate one.
2. Get an Agreement in Principle. Also called a Decision in Principle, this shows how much a lender would lend you based on an initial check. It isn't a formal offer, but estate agents take you more seriously with one. It usually lasts 30 to 90 days and can often be arranged the same day.
3. Start house hunting. With a budget and an Agreement in Principle, you can look properly. Separate your must-haves from your nice-to-haves, and register with local agents and the property portals so you hear about new listings early.
4. Make an offer. Offers go through the estate agent, and there's usually room to negotiate, particularly if a property has been on the market a while. Once your offer is accepted the property is "sold subject to contract".
5. Apply for your mortgage. You'll need proof of income, bank statements, identification, proof of address and the details of the property. We'll put your application to the lender most likely to say yes to your circumstances.
6. Appoint a solicitor or conveyancer. They handle the legal side: searches, contracts, exchange and completion. We can suggest firms we work with regularly.
7. Get a survey. Your lender's valuation is for their benefit, not yours. A homebuyer report or, for older properties, a full building survey tells you what you're actually buying.
8. Exchange and complete. At exchange you're legally committed and pay your deposit. On completion the property is yours and you collect the keys.
Several government schemes exist to help first time buyers over the deposit and affordability hurdles. Each has its own rules, so it's worth knowing which ones you could use.
The First Homes scheme offers discounts of at least 30%, and in some areas up to 50%, on certain new build homes. Buyers must be first time buyers with a household income under £80,000 (£90,000 in London), and must fund at least half the discounted price with a mortgage. The discount is secured by a covenant, so it passes to the next buyer when you sell.
Shared Ownership lets you buy a share of a property and pay rent on the rest, which is usually owned by a housing association. The share is usually between 25% and 75%, and as little as 10% on some homes, so the deposit needed is much smaller. You can buy further shares later, a process called staircasing, and in many cases work up to owning the property outright. Our shared ownership page explains how the mortgage side works.
The Mortgage Guarantee Scheme supports lenders offering mortgages to buyers with deposits as small as 5%. It doesn't give you money; it makes those higher loan-to-value mortgages easier for lenders to offer. You still need to pass the lender's usual affordability and credit checks.
The Lifetime ISA pays a 25% government bonus on savings of up to £4,000 a year, so up to £1,000 a year, towards a first home or retirement. You can open one between 18 and 39 and pay in until you're 50. In June 2026 the government consulted on replacing it for new savers with a First Time Buyer ISA; existing Lifetime ISAs would continue, so it's worth checking the current position before you open one.
The Help to Buy ISA closed to new applicants in November 2019, but if you already hold one you can keep paying in until November 2029 and claim the 25% bonus, worth up to £3,000.
| Scheme | Discount/Bonus | Income Limit | Key Benefit |
|---|---|---|---|
| First Homes | 30–50% discount | £80,000 (£90,000 London) | Substantial price reduction |
| Shared Ownership | Buy 25–75% (10% on some homes), rent the rest | Varies by region | Lower deposit requirement |
| Mortgage Guarantee Scheme | Supports 5% deposit mortgages | No limit | More lenders at 95% LTV |
| Lifetime ISA | 25% bonus up to £1,000/year | No limit | Ongoing annual bonus |
| Help to Buy ISA | 25% bonus up to £3,000 | No limit | Closed to new savers |
First time buyers pay no stamp duty on the first £300,000 of a property's price, then 5% on the portion between £300,001 and £500,000. If the price is over £500,000, the relief doesn't apply at all and standard rates are charged on the whole purchase.
To qualify for first time buyer relief:
Our stamp duty calculator works out the figure for a specific price. Thresholds change from time to time in Budgets, so check them again close to your purchase.
The deposit is the biggest upfront cost for most first time buyers, and usually takes the longest to sort out.
Most lenders want a minimum of 5% to 10% of the price. A larger deposit, 15% or 20%, opens up lower rates, because the lender is taking less risk. On a £250,000 home, 5% is £12,500 and 20% is £50,000, so the gap between them is worth planning for.
The difference in rate between a small deposit and a large one adds up over the years of a mortgage, so if you're close to the next threshold (10%, 15%, 20%), it's often worth waiting a few months to reach it.
A Lifetime ISA is one of the simplest ways to boost a deposit, because the 25% bonus is money you wouldn't otherwise have. If you already have a Help to Buy ISA, keep it going for the same reason.
Gifted deposits from family are accepted by most lenders, with a letter from the person giving it confirming it's a gift and not a loan, and that they keep no stake in the property.
For a £250,000 property with a 5% deposit of £12,500:
For a £350,000 property with a 10% deposit of £35,000:
These figures leave out any ISA bonus, which shortens the timeline.
The mortgage is the part that worries people most. In practice it's a sequence of straightforward steps, as long as you're prepared.
Start with an Agreement in Principle before you view anything seriously. It involves a credit check and basic income details, and tells you what you can realistically borrow. Most last around 90 days.
Most lenders will lend up to around 4.5 times your annual income, with some going to 5 or 5.5 times in particular circumstances. What you can actually borrow depends on your income, your existing debts, your regular outgoings and your credit history. Lenders also stress-test the payments against a higher rate than the one you'd be paying.
Fixed-rate deals remain the popular choice for first time buyers, because the payments stay the same for the fixed period, which makes budgeting easier in the first years of owning a home. Rates change constantly, so the right question isn't "what's the rate today" but "which deal suits how long I plan to stay and what I can afford".
A broker can reach deals that aren't available direct, and knows which lenders are comfortable with particular circumstances, which matters more than most people realise if anything about your situation is unusual.
Weeks 1 to 2: preparation. Check your credit file, gather payslips, bank statements and identification, and get an Agreement in Principle.
Weeks 3 to 4: application. Submit the full application, complete the income and expenditure assessment, and arrange the valuation once your offer is accepted.
Weeks 5 to 8: processing. The lender reviews everything, the valuation is done, and underwriting makes its decision.
Weeks 9 to 12: completion. The mortgage offer is issued, the legal work finishes, and the funds are released.
UK lenders don't use a single national credit score. The three agencies, Experian, Equifax and TransUnion, each have their own scale, and every lender applies its own rules to what it sees. A number that looks poor at one agency can be perfectly acceptable to a lender.
What lenders actually look at is your history: whether payments have been made on time, how much of your available credit you're using, how much other borrowing you have, and whether there are defaults, county court judgments or missed payments.
Check your file three to six months before you apply. All three agencies offer free access. Look for mistakes, which are more common than people expect, and dispute anything wrong. Make sure you're on the electoral roll at your current address, since lenders use it to confirm who you are.
In the months before you apply, avoid new credit applications, keep credit card balances well below their limits, and keep every payment on time. If your credit history is less than perfect, that doesn't rule out a mortgage, it changes which lenders will consider you, which is a large part of what we do.
Conveyancing is the legal work that transfers ownership to you. You'll need a solicitor or licensed conveyancer to handle it.
Budget roughly £1,000 to £2,500 in fees, plus searches and Land Registry fees, so £1,500 to £3,000 in total for most purchases. It's worth getting two or three quotes, and worth using someone used to first time buyer purchases.
Searches with the local authority, environmental bodies and the water authority usually take two to four weeks. They tell you about planning permissions, flood risk, drainage and anything else that affects the property.
Exchange of contracts usually happens one to two weeks before completion. At exchange you're legally committed and pay your deposit. On completion, the money moves, the property becomes yours, and you get the keys.
Week 1: instruct your solicitor, provide identification, and the contract pack is requested from the seller's solicitor.
Weeks 2 to 4: searches are carried out and enquiries raised on anything they turn up.
Weeks 3 to 5: the mortgage valuation is done, your solicitor checks the mortgage offer, and any survey issues are raised with the seller.
Weeks 5 to 6: the contract is agreed, deposit arrangements confirmed, and buildings insurance arranged from the exchange date.
Weeks 6 to 8: contracts are exchanged, a completion date is set, funds are requested, and on completion day the keys are handed over.
Beyond the deposit and the monthly payments, there's a set of costs that catches first time buyers out.
A survey costs from around £400 for a homebuyer report to about £1,500 for a full structural survey. The lender's valuation is not a survey; it exists to protect the lender, not you. On an older property, the fuller survey is usually money well spent.
Buildings insurance is required from exchange of contracts, typically £200 to £600 a year. Contents insurance is separate and optional, though most people want it.
Moving costs average around £1,200 using a removal firm, less if you do it yourself. Allow for storage if your completion and move-in dates don't line up.
Then there's everything the house needs on day one: white goods, furniture, and any immediate repairs. Depending on the property and what you already own, £3,000 to £10,000 is a realistic range.
Straight away:
Over the first year:
Costs run higher in London and the South East, and lower across much of the North, so treat these as a starting point rather than a quote.
Applications do get declined, and it isn't the end of the process. What matters is understanding why, and fixing that before you apply again.
Ask the lender for the specific reason rather than accepting a general answer. The usual causes are income that doesn't stretch to the loan, credit history, too small a deposit, or uncertainty about employment.
Wait around three months before reapplying, so you're not stacking up credit searches, and use that time to deal with the reason you were declined.
Specialist lenders take a more flexible view of smaller deposits, irregular income and imperfect credit than the high street does, though their rates usually reflect that.
Increasing your deposit, clearing existing debt, or adding a guarantor can each turn a decline into an approval.
Income doesn't stretch far enough: reduce other debt, consider a longer term, look at a slightly lower price, or apply jointly.
Credit history: get your reports, dispute errors, pay down balances, avoid new credit, and give older problems time to drop off your file.
Employment: provide more documentation, wait until you're past a probation period, or use a lender that understands your type of work.
Deposit too small: keep saving, consider a family gift, or look at shared ownership.
Self-employed applicants face more scrutiny. Most lenders want two to three years of accounts or SA302s from HMRC. Recent returns showing steady or rising income help.
Some lenders will consider one year of accounts, particularly where you have a track record in the same field, or moved from employment to self-employment doing similar work.
Accounts prepared by a qualified accountant carry more weight, and often pay for themselves in the terms you're offered.
Lenders typically work from the lower of your last two years, so if your most recent year is much stronger, timing your application can make a real difference to what you can borrow. Our self-employed mortgage page goes into this in more detail.
Usually at least 5% of the price. 10% or more gives you access to better rates, and each step up (10%, 15%, 20%) tends to improve what's available.
First Homes, Shared Ownership, the Mortgage Guarantee Scheme and the Lifetime ISA are the main ones, and a Help to Buy ISA if you opened one before November 2019. Which apply depends on your income, where you're buying and the property itself.
Not on the first £300,000. Between £300,001 and £500,000 you pay 5% on that portion. Above £500,000 there's no first time buyer relief at all.
Yes. Lenders offer mortgages at 95% of the property value, so a 5% deposit. Guarantor and family-assisted mortgages are also worth asking about if your deposit is small.
From offer accepted to keys in hand, eight to twelve weeks is normal, though chains, searches and lender workloads all move that.
Friends Capital is an independent, whole-of-market mortgage broker based at Beehive Works in Sheffield, authorised and regulated by the Financial Conduct Authority (FRN 650114). We're not tied to a limited panel of lenders, so the recommendation you get is the one that suits your circumstances.
First time buyers are a large part of what we do. We'll tell you honestly what you can borrow, get your Agreement in Principle in place, explain which schemes you qualify for, put your application to the lender most likely to accept it, and stay with it through to completion. Your first consultation is free, and we'll always confirm any fee before you commit to anything.
If you'd rather talk it through in person, you're welcome at our Sheffield office. If phone, email and video calls suit you better, that's how many of our clients prefer to work, wherever they're buying.
Call 0114 303 1031, email info@friendscapital.co.uk, or get in touch through the website, and one of our advisers will come back to you.