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First Time Buyer Mortgage Guide 2026
Our 2026 first-time buyer mortgage guide: how much you could borrow, deposits, monthly costs, Mortgage in Principle, schemes and buying costs explained.
Published
The below article has information contained within that was correct at the time of publication but is subject to change. This is for information purposes only and does not constitute advice.
First-Time Buyer Mortgage Guide 2026
Written by Doug Miller, Director at Lansdown Financial Services.
Doug Miller is a mortgage broker and co-founder of Lansdown Financial Services, based in Bath, quoted in 30+ news articles including the Guardian, Sky News, This is Money and the Sun.
Buying your first home should be exciting. But when you start looking into mortgages, deposits, interest rates and affordability, it can quickly feel like there’s an awful lot to understand.
How much can you borrow? How much deposit do you need? Which mortgage should you choose? And when should you speak to a mortgage adviser?
These are questions we hear from first-time buyers every day.
The good news is that getting a first-time buyer mortgage in 2026 doesn’t need to be complicated. Mortgages are available with deposits as small as 5%, and some lenders offer enhanced borrowing options for eligible first-time buyers.
The important thing is understanding what you can realistically afford before committing to a property.
This guide explains the mortgage process, the costs involved and what you should consider before buying your first home.
Key Points: The Short Version
Don’t have time to read the full article? Here are the six key things you need to know.
- How much can you borrow? Many lenders use income multiples of around 4.5 times salary as a starting point, although some eligible first-time buyers can borrow five, 5.5 or even six times income, subject to lender criteria and affordability.
- You could buy with a 5% deposit: For a £250,000 property, that means a £12,500 deposit and a £237,500 mortgage.
- Your monthly repayments depend on several factors: The mortgage amount, interest rate and repayment term all make a difference. A longer term can reduce monthly repayments but increase total interest paid.
- Fixed-rate mortgages provide certainty: Two-year and five-year fixed mortgages are common options, but the right choice depends on your circumstances and future plans.
- Get a Mortgage in Principle before seriously house hunting: This gives you an initial indication of what a lender may be prepared to lend and can put you in a stronger position when making an offer.
- Budget for more than the deposit: Legal fees, surveys, moving costs, insurance and potential Stamp Duty should all be considered.
The bottom line: The best place to start is by understanding your borrowing potential, deposit and comfortable monthly budget. Getting mortgage advice early can help you approach your first property purchase with greater confidence.
The Full Guide: Getting Your First-Time Buyer Mortgage in 2026
Want to understand the detail? Below, we explain everything from deposits and affordability to mortgage applications, first-time buyer schemes and the costs of purchasing your first home.
In This Guide
- How much first-time buyers can borrow
- How much deposit you need
- Monthly mortgage repayments
- Choosing the right mortgage
- Mortgage in Principles and credit history
- First-time buyer schemes and gifted deposits
- Documents needed for a mortgage
- The buying process from start to finish
- Stamp Duty and other purchase costs
- Frequently asked questions
How Much Can I Borrow as a First-Time Buyer?
This is normally the first question we get asked.
Unfortunately, there isn’t one figure that applies to everybody.
You may see mortgage calculators suggesting you can borrow four or five times your annual salary, but mortgage lenders assess affordability in different ways.
They’ll typically look at your income, financial commitments, regular expenditure, mortgage term and other aspects of your circumstances.
The type of income you receive also matters.
For example, lenders can take different approaches to overtime, bonuses, commission, self-employed profits and other variable income.
Can First-Time Buyers Borrow Five or Six Times Their Salary?
Potentially, yes.
While around 4.5 times income remains a useful starting point for understanding mortgage affordability, certain lenders offer enhanced borrowing options for eligible first-time buyers.
Some products can provide borrowing at five, 5.5 or even six times annual income, subject to eligibility and affordability requirements.
For example:
| Annual household income | 4.5 times income | 5 times income | 6 times income |
|---|---|---|---|
| £30,000 | £135,000 | £150,000 | £180,000 |
| £40,000 | £180,000 | £200,000 | £240,000 |
| £50,000 | £225,000 | £250,000 | £300,000 |
| £60,000 | £270,000 | £300,000 | £360,000 |
Illustrative income multiples only, not guaranteed mortgage offers. Higher income multiples are available only to eligible applicants and may be subject to restrictions on income, deposit, employment and mortgage product.
Importantly, being eligible for a higher income multiple doesn’t automatically mean borrowing the maximum amount is the right decision.
Your monthly repayments still need to be affordable alongside other living expenses.
At Lansdown Financial Services, we don’t simply multiply your salary by a number.
We assess your circumstances and consider how different lenders may calculate your affordability to establish what’s realistic for you.
How Much Deposit Do You Need for a First-Time Buyer Mortgage?
You don’t necessarily need a huge deposit to buy your first home.
Some mortgage lenders offer products requiring just a 5% deposit, allowing eligible buyers to borrow the remaining 95% of the property’s value.
The percentage you borrow compared with the property’s value is known as the loan-to-value ratio, or LTV.
Generally, the larger your deposit, the lower your LTV.
A lower LTV can potentially give you access to a wider range of lenders and more competitive mortgage rates.
First-Time Buyer Deposit Examples
Imagine you’re buying a property costing £250,000.
| Deposit percentage | Deposit required | Mortgage required |
|---|---|---|
| 5% | £12,500 | £237,500 |
| 10% | £25,000 | £225,000 |
| 15% | £37,500 | £212,500 |
| 20% | £50,000 | £200,000 |
A larger deposit reduces the amount you need to borrow and may improve the mortgage products available.
However, it doesn’t automatically mean you should wait until you’ve saved 10% or 15%.
If you already have a 5% deposit, it’s worth finding out what you could afford now rather than assuming you need to save for several more years.
Should You Use All Your Savings for the Deposit?
Not necessarily.
Using more of your savings towards the deposit could potentially secure a better interest rate or reduce your monthly mortgage repayments.
But you’ll also need money for the costs associated with buying and moving.
Solicitor fees, surveys, insurance, furniture and unexpected repairs can quickly add up.
Keeping some money aside for emergencies can be just as important as putting every available pound into the deposit.
We’d look at whether increasing your deposit would meaningfully improve your mortgage options before recommending how much to use.
How Much Will Your First Mortgage Cost Each Month?
Your monthly mortgage repayments will depend on the amount borrowed, interest rate and mortgage term.
For most first-time buyers purchasing their main residence, a capital repayment mortgage is the usual approach.
This means your monthly payments include both interest and an amount towards reducing the mortgage balance.
How Does the Mortgage Term Affect Monthly Repayments?
The mortgage term is the period over which you agree to repay the money borrowed.
A longer mortgage term generally reduces your monthly repayments because the balance is spread over more years.
However, you’ll normally pay more interest overall.
For example, consider a £225,000 repayment mortgage at an illustrative interest rate of 5%.
| Mortgage term | Approximate monthly repayment | Approximate total interest |
|---|---|---|
| 25 years | £1,315 | £169,600 |
| 30 years | £1,208 | £209,800 |
| 35 years | £1,136 | £252,000 |
| 40 years | £1,085 | £295,800 |
Illustrative calculations assuming a constant 5% interest rate throughout the entire mortgage term, monthly repayments and no fees or overpayments. Actual mortgage rates and payments will vary.
As you can see, a longer term can make the monthly mortgage payment more manageable, but the total interest paid can increase considerably.
Longer mortgage terms have become increasingly common. MoneyHelper reported in June 2026 that the average first-time buyer mortgage term had reached 31 years.
The right mortgage term should balance comfortable monthly payments against the longer-term cost of borrowing.
What Type of Mortgage Is Best for a First-Time Buyer?
There isn’t one mortgage product that’s automatically best because you’re buying your first home.
Most first-time buyers will consider fixed-rate mortgages, although tracker and other variable-rate products may also be available.
Fixed-Rate Mortgages
A fixed-rate mortgage keeps your interest rate unchanged for an agreed period, commonly two or five years.
This provides certainty over your normal monthly repayments during the fixed-rate period.
For first-time buyers adjusting to the costs of owning a home, that predictability can be particularly valuable.
Tracker Mortgages
A tracker mortgage usually follows another interest rate, commonly the Bank of England Bank Rate, plus an agreed margin.
This means your interest rate and monthly payments can increase or decrease as the rate being tracked changes.
Tracker products may suit some borrowers, but it’s important to understand how repayment increases could affect your budget.
Should You Choose a Two-Year or Five-Year Fixed Mortgage?
This is one of the most common questions we’re asked.
A two-year fixed mortgage provides payment certainty for a shorter period and allows you to review your mortgage sooner.
A five-year fixed mortgage offers longer-term certainty but may involve early repayment charges if you need to leave the mortgage during that period.
We’d consider your future plans, income stability, potential house moves and preference for predictable payments.
Trying to predict exactly where interest rates will be in two or five years isn’t something we’d recommend building the entire decision around.
The mortgage needs to suit your circumstances, not simply your expectations about future interest rates.
What Is a Mortgage in Principle?
A Mortgage in Principle, also called an Agreement in Principle (AIP) or Decision in Principle (DIP), is an initial indication from a mortgage lender of how much it may be prepared to lend you.
It’s generally based on information about your income, deposit, credit history and financial commitments.
Having one before you seriously start viewing properties can be helpful for two reasons.
Firstly, it gives you a more realistic idea of your budget.
Secondly, it can demonstrate to estate agents that you’ve already taken steps to arrange your mortgage finances.
However, a Mortgage in Principle isn’t a guaranteed mortgage offer.
The lender will still need to assess your full application and the property you’re buying.
At Lansdown Financial Services, we can help establish your borrowing potential and arrange a Mortgage in Principle with a suitable lender.
For a more detailed explanation, read our guide: How to Get a Mortgage in Principle.
Can Your Parents Help with Your Mortgage Deposit?
Yes.
Gifted deposits are common among first-time buyers.
This is where a family member provides money towards your property deposit, usually without expecting repayment.
Mortgage lenders have different rules about who can provide a gifted deposit and what evidence is required.
They’ll generally want confirmation that the money is genuinely a gift rather than an undisclosed loan.
Your solicitor will also need to carry out appropriate source-of-funds checks.
Some lenders offer additional mortgage arrangements involving family support, such as guarantor or family-assisted mortgages.
If your family is helping with your purchase, tell us at the beginning so we can consider lenders whose criteria are suitable.
Do You Need a Perfect Credit Score to Get a Mortgage?
No.
There isn’t one universal credit score that every mortgage lender uses when deciding whether to approve an application.
Lenders have their own credit assessments and eligibility criteria.
If you’ve previously missed a payment or experienced other credit problems, that doesn’t automatically mean you won’t qualify.
The nature of the issue, when it occurred and your subsequent credit history can all be relevant.
We’d recommend checking your credit reports before applying and making sure the information recorded is accurate.
If there’s anything you’re concerned about, discuss it with your mortgage adviser before submitting applications.
A lender declining an application doesn’t necessarily mean every other lender will reach the same decision.
What Documents Do First-Time Buyers Need for a Mortgage?
Getting your paperwork organised early can help the mortgage application run more smoothly.
The exact documents required depend on your circumstances and the lender.
| Document | Why it may be needed |
|---|---|
| Proof of identity | To verify your identity. |
| Payslips | To evidence employment income. |
| Bank statements | To review income, expenditure and financial commitments. |
| Proof of deposit | To confirm the amount and source of your deposit. |
| Self-employed income documents | Tax calculations, tax year overviews or accounts, where applicable. |
| Gifted deposit evidence | To confirm the source and nature of funds provided by family members. |
Being prepared doesn’t mean you need every document before an initial conversation.
We can explain what’s likely to be required once we understand your circumstances.
What First-Time Buyer Schemes Are Available in 2026?
There are several schemes and mortgage options that may help eligible first-time buyers.
However, they work differently, and not every scheme will be relevant to your circumstances.
| Scheme or option | How it may help |
|---|---|
| First Homes | Eligible buyers in England can purchase certain properties at a discount of 30% to 50%. |
| Shared Ownership | Allows eligible buyers to purchase a share of a property and pay rent on the remaining share. |
| Lifetime ISA | Offers a 25% government bonus on eligible savings, subject to contribution and withdrawal rules. |
| 95% mortgages | Allow eligible buyers to purchase with a 5% deposit. |
| Mortgage Guarantee Scheme | Supports participating lenders offering qualifying low-deposit mortgages. |
Not every first-time buyer needs to use a government scheme.
For some, a conventional mortgage with a 5% or 10% deposit may be the most suitable option.
For others, Shared Ownership or First Homes could make purchasing a property achievable.
We’d start by understanding your borrowing potential and then compare the realistic options available.
You can explore these in more detail in our separate guide: First-Time Buyer Schemes Explained.
How Do You Get Your First-Time Buyer Mortgage?
The mortgage process can be broken down into a series of manageable stages.
| Stage | What happens |
|---|---|
| 1. Get mortgage advice | Establish your borrowing potential, deposit and suitable mortgage options. |
| 2. Arrange a Mortgage in Principle | Obtain an initial indication of how much a lender may be prepared to lend. |
| 3. Search for a property | View homes that fit your budget and requirements. |
| 4. Make an offer | Negotiate your purchase through the estate agent or seller. |
| 5. Apply for your mortgage | Choose a suitable product and submit the full application. |
| 6. Mortgage valuation and underwriting | The lender assesses your application and the property. |
| 7. Receive your mortgage offer | The lender issues its formal offer, subject to applicable conditions. |
| 8. Complete your purchase | Your conveyancer completes the legal process and you receive the keys. |
When Should You Speak to a Mortgage Adviser?
Ideally, before you start seriously viewing properties.
You don’t need to have found a house before asking for mortgage advice.
In fact, we’d much rather establish your finances early than discover an issue after you’ve had an offer accepted.
An early conversation can help identify your likely borrowing capacity, comfortable monthly repayments and the lenders most appropriate for your circumstances.
And if there’s something that needs addressing before you buy, you’ll have the opportunity to deal with it before making a commitment.
What Other Costs Do First-Time Buyers Need to Budget For?
Your deposit will probably be your largest upfront expense, but it isn’t the only cost of purchasing a home.
Other potential costs include solicitor or conveyancing fees, mortgage arrangement fees, surveys, valuations, removals and buildings insurance.
Once you’ve moved in, you’ll also need to budget for Council Tax, utilities, maintenance and everyday household expenses.
It’s worth understanding these costs before deciding how much of your savings to use for the deposit.
Do First-Time Buyers Pay Stamp Duty in 2026?
In England and Northern Ireland, qualifying first-time buyers benefit from Stamp Duty Land Tax relief.
Under the current rules, eligible first-time buyers pay:
- 0% on the first £300,000 of the property price.
- 5% on the portion between £300,001 and £500,000.
- Normal residential SDLT rates if the property costs more than £500,000, because first-time buyer relief doesn’t apply.
For example:
| Purchase price | Stamp Duty for an eligible first-time buyer |
|---|---|
| £250,000 | £0 |
| £300,000 | £0 |
| £350,000 | £2,500 |
| £400,000 | £5,000 |
| £500,000 | £10,000 |
Illustrative figures for qualifying purchases in England and Northern Ireland. Different property taxes apply in Scotland and Wales.
If you’re buying jointly, everyone purchasing must meet the first-time buyer eligibility requirements to claim this relief.
Your solicitor can confirm the exact Stamp Duty payable on your purchase.
What If You’re Buying Your First Home with Someone Else?
Buying jointly can sometimes increase your potential borrowing capacity because lenders may consider both applicants’ incomes.
However, they’ll also assess both applicants’ financial commitments and credit histories.
One important consideration is whether both buyers qualify as first-time buyers.
For example, if one person has previously owned a property, that could affect eligibility for certain first-time buyer schemes or Stamp Duty relief.
It’s important to explain your circumstances from the outset so the mortgage and associated purchase costs can be assessed correctly.
What Are the Biggest Mistakes First-Time Buyers Make?
The biggest mistake we see is trying to work everything out after finding the property.
Getting your finances organised first can make the whole process easier.
Other common issues include concentrating only on the maximum amount a lender might offer, forgetting additional purchase costs or choosing a mortgage based solely on the headline interest rate.
Just because you can borrow a certain amount doesn’t necessarily mean you should.
The monthly repayments need to work comfortably alongside your other commitments, with enough flexibility for unexpected expenses.
It’s also worth remembering that the lender offering the lowest advertised rate isn’t necessarily the lender most suitable for your circumstances.
Our advice is simple: establish your budget, understand your options and get mortgage advice before committing to a purchase.
Frequently Asked Questions About First-Time Buyer Mortgages
Can I Get a First-Time Buyer Mortgage with a 5% Deposit?
Yes, potentially.
Some lenders offer mortgages at 95% loan-to-value, meaning you’ll need a 5% deposit.
However, approval will depend on your income, affordability, credit history and the property you’re purchasing.
Can I Get a Mortgage If I’ve Recently Started a New Job?
Potentially, yes.
Some lenders are comfortable with applicants who have recently started employment, while others have more restrictive requirements.
Your employment contract, previous work history and circumstances may influence the options available.
How Long Does It Take to Get a First-Time Buyer Mortgage?
The timescale varies depending on the lender, the complexity of your application and the property.
A Mortgage in Principle can sometimes be arranged quickly, while a full mortgage offer generally requires more detailed underwriting and a property assessment.
The overall homebuying process also depends on conveyancing, searches and the circumstances of the wider property chain.
Is It Better to Use a Mortgage Broker as a First-Time Buyer?
A mortgage broker can help you understand your borrowing capacity, compare suitable lenders, explain different mortgage products and manage the application.
You can also apply directly to a lender, but a whole-of-market broker can consider a much broader range of mortgage providers rather than just one bank’s products.
How Lansdown Financial Services Can Help
Buying your first home is a major financial commitment, but the mortgage process doesn’t need to be overwhelming.
At Lansdown Financial Services, we’ll start by answering the questions that matter most.
How much could you borrow? What deposit do you need? How much might your mortgage cost each month? And which lenders are likely to be suitable for your circumstances?
We’ll take the time to understand your income, savings, financial commitments and future plans before recommending an appropriate mortgage.
If you’re ready to start looking for a property, we can arrange a Mortgage in Principle to help establish your budget.
Once you’ve found your first home, we’ll compare the available products and guide you through the mortgage application, underwriting and formal offer stages.
As a free, whole-of-market mortgage adviser with access to more than 70 lenders, we provide straightforward, personalised advice without the jargon.
Thinking about buying your first home in 2026?
Contact Lansdown Financial Services or call 01225 459515 to speak to one of our award-winning mortgage advisers for free, expert first-time buyer mortgage advice.
Your home may be repossessed if you do not keep up repayments on your mortgage.
About the Author
Written by Doug Miller, Director at Lansdown Financial Services.
Doug Miller is a mortgage broker and co-founder of Lansdown Financial Services, based in Bath, quoted in 30+ news articles including the Guardian, Sky News, This is Money and the Sun.
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