First-Time Buyer Mortgages UK: Avoid Common Mistakes and Understand Your Options

Buying your first home in the UK is an exciting but often overwhelming experience. If you're searching for first-time buyer mortgage advice or wondering how to get a mortgage as a first-time buyer in the UK, preparation is key.

Proper planning can make the mortgage application process smoother, help you avoid costly mistakes, and give you a clear picture of what you can realistically afford.

In this guide, we’ll cover essential tips for first-time buyers, including common pitfalls, understanding deposit and loan-to-value (LTV) ratios, and available mortgage options tailored for first-time buyers in the UK.

Common Mistakes First-Time Buyers Make When Applying for Mortgages in the UK

Many first-time buyers underestimate how important early preparation is. Here are three common mistakes to avoid that can improve your chances of mortgage approval:

Mistake 1: Not Checking Your Credit Score Early

Waiting until the last minute to check your credit report can delay your mortgage application or cause rejection. Errors like outdated addresses, incorrect accounts, or wrongly listed missed payments can impact your creditworthiness.

What you should do:

Check your credit reports from all three UK credit reference agencies (Experian, Equifax, TransUnion) well before applying.
Register on the electoral roll to strengthen your credit profile.
Avoid applying for new credit or loans close to your mortgage application date.

Mistake 2: Underestimating Additional Home Buying Costs

Many first-time buyers focus solely on the deposit and monthly mortgage repayments, overlooking additional costs involved in buying a home. These can include:

Solicitor and conveyancing fees
Property survey and valuation fees
Removal and home setup expenses
Stamp duty land tax (if applicable)
Mortgage product fees and broker fees
Insurance such as income protection or buildings insurance

Pro tip: Always keep a financial buffer to avoid being stretched too thin during exchange and completion.

Mistake 3: Not Matching Spending Habits and Documentation to Lender Requirements

Lenders carefully assess your financial documents, looking for consistency across payslips, bank statements, and outgoings. Potential issues include:

Frequent overdraft use
Missed payments on credit or bills
Heavy use of buy now, pay later schemes
Unexplained bank transfers or irregular income
Regular gambling transactions

If you are self-employed, lenders will place particular emphasis on your accounts and tax returns when deciding how much you can borrow and which lenders will consider your application.

How Much Deposit Do You Need for a First-Time Buyer Mortgage in the UK?

A common question is, “How much deposit do I need for a first-time buyer mortgage UK?” The answer depends on your circumstances and the lender’s criteria.

Understanding Loan-to-Value (LTV) Ratios

LTV is the percentage of the property value you borrow. For example:

A 5% deposit corresponds to a 95% LTV
A 10% deposit corresponds to a 90% LTV
A 15% deposit corresponds to an 85% LTV

Why LTV Matters

Lower LTV usually means access to better interest rates and more lender options.
Higher LTV often results in higher rates and stricter lending criteria.
At higher LTVs, consider the risk of house prices falling and potential negative equity.

Practical Takeaways

Saving a larger deposit can reduce monthly mortgage repayments.
Buying with a smaller deposit can still make sense if payments are affordable — everyone’s circumstances are different.
Use a mortgage payment calculator to understand how deposits and rates affect costs.

First-Time Buyer Mortgage Options in the UK

Lifetime ISA (LISA) for First-Time Buyers

A Lifetime ISA can help you build your deposit with a government bonus if you’re eligible. Keep in mind:

Annual contribution limits apply (check current limits on MoneyHelper)
Property price caps must be respected
Withdrawals not used for buying your first home may incur penalties

Low Deposit Mortgages (0–5% Deposit)

Some lenders offer mortgages with deposits as low as 0–5%. These tend to come with:

Higher interest rates
Tighter lending criteria

Shared Ownership Schemes

Shared ownership allows you to buy a share of a property and pay rent on the rest.

Ongoing service charges and maintenance fees
Staircasing options
Resale restrictions

See the official guidance on shared ownership.

Family Help with Deposits or Guarantees

Gifted deposits may require proof of source and a gift letter
Guarantor mortgages involve serious long-term commitments

Why Professional Mortgage Advice Matters

Mortgage lending criteria vary widely across lenders. A qualified mortgage adviser ensures your application is assessed properly and tailored to your circumstances.

FCA-regulated advisers must act fairly and help you understand all risks and costs.

This content is for informational purposes only and does not replace personalised financial advice.

You can watch our video all about First Time Buyer Mortgages below.

Take the Next Step: Expert First-Time Buyer Mortgage Advice with HHH Mortgages

HHH Mortgages offers expert first-time buyer mortgage advice in the UK, including:

Credit readiness assessment
Realistic budgeting for deposits and fees
Deposit and LTV strategy planning
Lender recommendations

Home Mortgages