First Time Buyer

What is a first time buyer mortgage?

A first time buyer mortgage is a loan designed to help people purchase their first property. The amount you borrow is repaid over an agreed period, typically around 25 years or longer, through regular monthly payments that include interest.

It is important to choose a mortgage that suits your financial circumstances. If mortgage repayments are not maintained, your property may be repossessed by the lender.

Am I a first time buyer?

You may be considered a first time buyer if:

• You have never owned a residential property before in the UK or abroad
• You intend to live in the property as your main home

You may not be considered a first time buyer if:

• You are buying a property with someone who currently owns or has previously owned a home
• You have inherited a residential property in the past
• A third party who already owns a property is purchasing the home on your behalf

How to get a first time buyer mortgage

Buying your first home involves several stages. While the exact process may vary depending on your circumstances, it generally includes the following steps.

1. Understand how much you may be able to borrow

Begin by reviewing your finances, including your deposit savings, income, regular expenses and credit commitments. Mortgage calculators can provide an initial estimate of borrowing capacity, although a detailed assessment will depend on individual circumstances and lender criteria.

A mortgage adviser can review your financial position and explain the options that may be available to you.

2. Obtain a mortgage agreement in principle

An agreement in principle provides an indication from a lender of how much they may be prepared to lend based on initial information. Having this in place can help demonstrate to estate agents and sellers that you are a serious buyer.

This usually involves a preliminary assessment and may include a soft credit check.

3. Search for a suitable property

Once you have an idea of your price range, you can begin searching for properties that meet your needs. When you find a property you wish to purchase, you can submit an offer through the estate agent.

4. Apply for a mortgage

If your offer is accepted, the next step is to complete a full mortgage application. Your lender will review your financial information and confirm whether they are able to offer the loan.

5. Receive a mortgage offer

Once the lender has completed their checks, including a valuation of the property, they may issue a formal mortgage offer. Your solicitor will then handle the legal process leading up to completion.

How much of a deposit do I need?

Many first time buyers aim to save a deposit of around 5% to 10% of the property’s value, although the exact amount required will depend on the lender and the mortgage product.

For example, if a property is valued at £285,000, the deposit required could look like this:

Deposit percentage	Deposit value
5%	£14,250
10%	£28,500
15%	£42,750

What type of mortgage may suit first time buyers?

There is no single mortgage type that suits everyone. The right option will depend on your financial circumstances, plans and risk tolerance. Some common mortgage types include:

• Fixed rate mortgages: The interest rate remains the same for a set period, helping provide certainty over monthly payments.
• Variable rate mortgages: The interest rate may change over time depending on the lender’s standard rate.
• Tracker mortgages: The interest rate typically follows the Bank of England base rate, moving up or down accordingly.
• Offset mortgages: Savings held with the same lender may reduce the amount of interest charged on the mortgage balance.
• Interest-only mortgages: Monthly payments cover the interest only, with the original loan amount repaid at the end of the term. These are less commonly available to first time buyers.
• Joint mortgages: Two or more applicants combine their income to purchase a property and share responsibility for the repayments.

What schemes may help first time buyers?

Some government initiatives are designed to support people purchasing their first home. Examples include:

• Lifetime ISA: Savings accounts that allow eligible individuals aged 18 to 40 to receive a government bonus on contributions used towards a first home.
• First Homes Scheme: A scheme intended to help eligible buyers purchase certain new-build properties at a discounted price.
• Shared ownership: Allows buyers to purchase a share of a property and pay rent on the remaining share.
• Mortgage guarantee scheme: Designed to support lenders offering higher loan-to-value mortgages for eligible buyers.

Do first time buyers pay stamp duty?

Stamp Duty Land Tax may apply when purchasing a property. In some cases, first time buyers may benefit from relief depending on the purchase price and government rules at the time of purchase.

Why choose Godfrey Financial Solutions for first time buyer mortgage advice?

Buying your first property can involve many decisions. Our adviser can provide guidance throughout the process, helping you understand your options and the steps involved.

• Independent guidance: We aim to provide clear information about mortgage options available based on your circumstances.
• Access to a range of lenders: Mortgage advisers can review products from multiple lenders to identify suitable options.
• Support throughout the process: From the initial enquiry through to application and completion, we aim to make the process easier to navigate.
• Clear communication: We focus on helping clients understand the mortgage process and the choices available to them.