Possibly. If you’ve never owned a home before, you are considered a first-time buyer, which means you can apply for a first-time buyer mortgage.
However, you are not considered to be a first-time buyer if you’ve ever owned or inherited property - even if you’ve never lived there.
It’s worth bearing in mind that most mortgage deals available to first-time buyers are also available to those who already own a home.
There are certain schemes designed to help first-time buyers get on the property ladders. These include the mortgage guarantee scheme, shared ownership, the first homes scheme and Lifetime ISAs.
You’ll also get a discount on Stamp Duty if you’re a first-time buyer, but if you are buying as a couple and one of you has previously owned a property, the other will forfeit their first-time buyer status.
There’s good news for commercial property owners, though. If you've owned a shop or restaurant but have never owned a home, you can still be considered a first-time buyer.
Lenders will generally lend you around four to four-and-a-half times your annual salary, but they take other factors into account.
Some of the criteria banks and lenders use to calculate how much you can borrow include:
Income
Deposit
Regular outgoings
Debts
Credit history
To increase your borrowing potential, it's a good idea to start spending sensibly and reduce your outgoings three to six months before you apply.
It's also worth finding out what your credit score is. Make sure the information they have is correct and up-to-date and if not, you should look to change this well before you apply for a mortgage.
You can also take steps to improve your credit rating by showing the lender you're comfortable managing debt. A common way to do this is to start using a credit card and making the repayments on time.
You should join the electoral register if you haven't already, as lenders often see this as a sign of reliability.
The First Homes scheme allows first-time buyers in England to purchase properties for 30 to 50% less than market value.
The home must be:
A new build home, or
A resale home that was originally bought as part of the First Homes scheme
To be eligible, in addition to being a first-time buyer, you must be:
18 or older
Able to get a mortgage for at least half the price of the home
Buying as part of a household where the annual income does not exceed £80,000, or £90,000 in London
Another government scheme is shared ownership.
This initiative lets you buy between 10% and 75% of a home as a share from a housing association or other organisation and pay rent on the rest.
Shared ownership lets you buy a house with a smaller mortgage and a smaller deposit.
You have the option to buy more of the property later once you can afford it. This process is known as “staircasing”.
Normally people can "staircase" until the point that they own 100% of the property.
You need to find a lender who offers shared ownership mortgages if you want to use this scheme.
If you're between 18 and 40, you can open a Lifetime ISA (LISA). Under the rules, you can pay £4,000 a year into your LISA until you're 50. The government adds a 25% bonus to the money you save, up to £1,000 annually.
If you withdraw the money for reasons other than your first home or retirement, you’ll pay a withdrawal charge of 25%, which means you’ll lose the government bonus plus some on top.
You can use the money from a LISA to buy your first home if you're buying with a mortgage and:
The property costs £450,000 or less
You have a LISA for at least a year before you buy a property
You use a conveyancer or solicitor to act for you in the purchase
If you're buying a property in the UK, you may have to pay some form of Stamp Duty. How much you'll need to pay depends on the property's value.
However, if you're a first-time buyer, you'll usually get a discount. In England and Northern Ireland, first-time buyers don't pay any Stamp Duty up to £425,000 (compared to £250,000 for others). For properties up to £625,000 you'll pay no Stamp Duty on the first £425,000 and then you'll pay 5% on the remaining amount. If the property you're purchasing is over £625,000, you won't benefit from the relief at all.
In Scotland, Stamp Duty is known as Land and Building Transaction Tax (LBTT). First-time buyers benefit from LBTT relief up to £175,000, saving them up to £600.
In Wales, first-time buyers don't get any additional Land Transaction Tax (LTT) relief. However, no LTT is charged on properties less than £225,000.
In April 2021, the mortgage guarantee scheme was introduced to bring back 95% mortgages to the market.
During the Covid-19 pandemic many lenders withdrew their products that were available to those with 5% deposits. Through the government guarantee scheme, the government agreed to guarantee part of the loan for certain high loan-to-value (LTV) mortgages, taking some of the risk away from lenders.
The scheme did increase the number of 95% mortgages on the market. However, it is coming to an end in December 2023.
If you are able to save up a bigger 10 or 15% deposit, you will usually get access to better rates and deals.
The Help to Buy scheme is no longer available to new applicants in England, but continues to be open to applicants in Wales until December 2026.
This government scheme can help you to get a mortgage with a 5% deposit, but is only available for new-build properties.
The scheme provides an equity loan to top up your deposit, which means you borrow money less money from the mortgage lender.
You must repay the loan when you sell your home, and if the price of your home has risen, some of that increase will also be repayable on the equity loan.
The First Homes scheme allows first-time buyers in England to purchase properties for 30 to 50% less than market value.
The home must be:
A new build home, or
A resale home that was originally bought as part of the First Homes scheme
To be eligible, in addition to being a first-time buyer, you must be:
18 or older
Able to get a mortgage for at least half the price of the home
Buying as part of a household where the annual income does not exceed £80,000, or £90,000 in London
Another government scheme is shared ownership.
This initiative lets you buy between 10% and 75% of a home as a share from a housing association or other organisation and pay rent on the rest.
Shared ownership lets you buy a house with a smaller mortgage and a smaller deposit.
You have the option to buy more of the property later once you can afford it. This process is known as “staircasing”.
Normally people can "staircase" until the point that they own 100% of the property.
You need to find a lender who offers shared ownership mortgages if you want to use this scheme.
If you're between 18 and 40, you can open a Lifetime ISA (LISA). Under the rules, you can pay £4,000 a year into your LISA until you're 50. The government adds a 25% bonus to the money you save, up to £1,000 annually.
If you withdraw the money for reasons other than your first home or retirement, you’ll pay a withdrawal charge of 25%, which means you’ll lose the government bonus plus some on top.
You can use the money from a LISA to buy your first home if you're buying with a mortgage and:
The property costs £450,000 or less
You have a LISA for at least a year before you buy a property
You use a conveyancer or solicitor to act for you in the purchase
If you're buying a property in the UK, you may have to pay some form of Stamp Duty. How much you'll need to pay depends on the property's value.
However, if you're a first-time buyer, you'll usually get a discount. In England and Northern Ireland, first-time buyers don't pay any Stamp Duty up to £425,000 (compared to £250,000 for others). For properties up to £625,000 you'll pay no Stamp Duty on the first £425,000 and then you'll pay 5% on the remaining amount. If the property you're purchasing is over £625,000, you won't benefit from the relief at all.
In Scotland, Stamp Duty is known as Land and Building Transaction Tax (LBTT). First-time buyers benefit from LBTT relief up to £175,000, saving them up to £600.
In Wales, first-time buyers don't get any additional Land Transaction Tax (LTT) relief. However, no LTT is charged on properties less than £225,000.
In April 2021, the mortgage guarantee scheme was introduced to bring back 95% mortgages to the market.
During the Covid-19 pandemic many lenders withdrew their products that were available to those with 5% deposits. Through the government guarantee scheme, the government agreed to guarantee part of the loan for certain high loan-to-value (LTV) mortgages, taking some of the risk away from lenders.
The scheme did increase the number of 95% mortgages on the market. However, it is coming to an end in December 2023.
If you are able to save up a bigger 10 or 15% deposit, you will usually get access to better rates and deals.
The Help to Buy scheme is no longer available to new applicants in England, but continues to be open to applicants in Wales until December 2026.
This government scheme can help you to get a mortgage with a 5% deposit, but is only available for new-build properties.
The scheme provides an equity loan to top up your deposit, which means you borrow money less money from the mortgage lender.
You must repay the loan when you sell your home, and if the price of your home has risen, some of that increase will also be repayable on the equity loan.
With a fixed-rate mortgage, the interest rate is guaranteed to remain the same for a set period, which means your monthly payments remain the same, making it easier to budget.
The downsides are that the payments might be slightly higher initially than they would with the best variable mortgage and you won’t benefit if interest rates drop.
On the other hand, your repayments won’t increase if interest rates rise.
You can fix your mortgage for different lengths of time depending on the deal.
Generally two-year fixed-rate mortgages and five-year fixed-rate mortgages are the most popular.
With a variable-rate mortgage, the interest rate can change. The monthly repayments are usually cheaper than a fixed deal at first, but the downside is that these could increase during the deal.
There are different types of variable-rate mortgage:
Tracker mortgage - the interest rate can go up and down during the initial deal, in line with movements in another financial indicator, normally the Bank of England base rate.
Discounted mortgage - the interest rate is usually a set percentage below your lender's standard variable rate (SVR) during the initial deal, which means it can go up and down.
If you’re considering a variable mortgage, make sure you could afford it if rates were to rise.
Offset mortgages allow you to use your savings to reduce how much of your mortgage you pay interest on.
When your mortgage repayments are calculated, the total savings are deducted from the capital owed before the interest is added.
The downside is that the savings account typically doesn’t pay any interest on the money you have stashed away.
Your savings account must be held with the same bank or building society you've borrowed from for you to be eligible for an offset mortgage.
You can also get family offset mortgages. This is when a family member, often one or both of your parents, uses their savings to offset your mortgages.
You can get both fixed and variable rate offset mortgages.
With a fixed-rate mortgage, the interest rate is guaranteed to remain the same for a set period, which means your monthly payments remain the same, making it easier to budget.
The downsides are that the payments might be slightly higher initially than they would with the best variable mortgage and you won’t benefit if interest rates drop.
On the other hand, your repayments won’t increase if interest rates rise.
You can fix your mortgage for different lengths of time depending on the deal.
Generally two-year fixed-rate mortgages and five-year fixed-rate mortgages are the most popular.
With a variable-rate mortgage, the interest rate can change. The monthly repayments are usually cheaper than a fixed deal at first, but the downside is that these could increase during the deal.
There are different types of variable-rate mortgage:
Tracker mortgage - the interest rate can go up and down during the initial deal, in line with movements in another financial indicator, normally the Bank of England base rate.
Discounted mortgage - the interest rate is usually a set percentage below your lender's standard variable rate (SVR) during the initial deal, which means it can go up and down.
If you’re considering a variable mortgage, make sure you could afford it if rates were to rise.
Offset mortgages allow you to use your savings to reduce how much of your mortgage you pay interest on.
When your mortgage repayments are calculated, the total savings are deducted from the capital owed before the interest is added.
The downside is that the savings account typically doesn’t pay any interest on the money you have stashed away.
Your savings account must be held with the same bank or building society you've borrowed from for you to be eligible for an offset mortgage.
You can also get family offset mortgages. This is when a family member, often one or both of your parents, uses their savings to offset your mortgages.
You can get both fixed and variable rate offset mortgages.
When buying a home, the bigger your deposit, the better your interest rate will be.
You normally need to have a deposit of at least 5% of the property value to get a mortgage. This will result in a 95% LTV mortgage, which is the maximum that almost all lenders will accept.
LTV is a measure of the percentage of the property price that you will need to borrow to make the purchase. Generally, the lower the LTV ratio, the better the deals you can access from mortgage lenders.
That's why it's often worth trying to save more than just a 5% deposit if you can. Even a 10 to 15% deposit will usually give you a much better selection of mortgage deals.
The table below shows the different deposit amounts required to access different LTV ratios for a £200,000 property.
| Loan-to-value ratio (LTV) | Deposit | Mortgage loan amount |
|---|---|---|
| 95% | £10,000 | £190,000 |
| 90% | £20,000 | £180,000 |
| 85% | £30,000 | £170,000 |
| 80% | £40,000 | £160,000 |
| 75% | £50,000 | £150,000 |
Dean Wickett, Mortgage Expert at Mojo Mortgages, said: “I normally ask people if they can put any more of a deposit down, so they can borrow less. Having a lower loan to value ratio might mean you can get access to slightly better rates. And if it doesn’t get you a much better rate, it does mean you’ve borrowed less, and will therefore pay less interest overall.”
There are other costs to consider when doing your first-time buyer mortgage, other than a deposit, including:
Stamp duty - First-time buyers will have to pay Stamp Duty depending on the property purchase price. To find out more about how much property tax you'll need to pay, use our Stamp Duty calculator.
Arrangement fee - This is the administration charge made by lenders for arranging to take out a mortgage. Fees vary, and you can choose to either pay this up-front or add it onto your mortgage. However, if you choose the latter expect to pay more in interest.
Survey fees - The money paid to a surveyor to perform an inspection on the property's structure to determine its condition and value. The fee varies depending on the level of detail you want and the size of the property.
Legal fees - The sum paid for legal services, including conveyancing and land searches.
Home insurance - As part of their contract, some lenders only offer mortgages if you have buildings insurance.
It is very unlikely that you will be offered an interest-only mortgage as a first-time buyer.
Most mortgages are capital repayment mortgages, where you pay off the interest and the capital (the amount you borrowed) with each monthly payment.
You can use our mortgage affordability calculator to work out how much you could borrow. From there, look at properties in the area where you want to buy and work out how much you need to save as a deposit.
Mortgage repayment calculators can give you an idea of what your monthly payments will be. Compare these estimated payments with your current monthly outgoings to see if you can afford them.
Yes, your credit record matters for any mortgage application. Lenders want to see proof that you can keep up repayments.
If your credit score is low, you may find fewer lenders willing to give you a loan. However, speaking to a mortgage broker can help you find the providers that are more likely to.
It is possible to get a first-time buyer mortgage with a 95% LTV.
5% deposit mortgages were largely withdrawn from the market near the start of the coronavirus pandemic but the mortgage guarantee scheme, which was introduced in April 2021, helped bring them back.
The best mortgage for you will be affordable and suit your circumstances. To find the cheapest deal, you should look at the total cost over the initial offer, which will take the interest rate and fees into account.
It's often a good idea to speak to a mortgage adviser who can help you find the most suitable deal for you.
Most mortgages need at least a 5% deposit. For better interest rates, you will need to save more – the lower your LTV, the cheaper your mortgage is likely to be.
Some 100% mortgages are available to help you get onto the property ladder without a deposit, but these usually require having a friend or family member act as a guarantor.
Yes, and getting a joint mortgage means you could borrow more and make the repayments easier to afford.
Yes, if you're self-employed you can get a mortgage but you'll need to prove to the lender that you have at least two years of reliable income. If you can provide this, your mortgage rates should be no different than those in full-time roles.
Use the links below to find out about other mortgages
