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First Time Buyers

Congrats! You have decided to buy your own home. We understand that buying your first home can be both exciting and daunting at the same time, and our friendly team of mortgage advisers are here to help guide you from start to completion.

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Buying your first home is an incredibly exciting time - but it's also often daunting for applicants dealing with the mortgage application process at the same time.

In this guide, the Revolution Brokers team explains all you need to know about being a first-time homebuyer and what to expect from the mortgage application process.

Mortgages can be nerve-wracking since they're often the most significant and longest-term debt any of us take on, but as an independent broker, we're here to simplify it for you.

Read on for more information about first-time buyer mortgages, or give Revolution a call on 0330 304 3040 to chat with one of our friendly advisors. Alternatively, drop a message to info@revolutionbrokers.co.uk, and we'll be in touch.

What is a First-Time Buyer Mortgage?

A mortgage is a loan from a lender/bank secured against the property you intend to purchase.

As with other loans, you will need to make monthly payments to pay off that loan.

This borrowing will have to be paid off over the term, usually 25 years.

The following topics are covered below:

Extended Term Best Mortgages for First-Time Buyers

How Much Can I Borrow on a First-Time Buyer Mortgage?

Can I Use a First-Time Buyer Mortgage Calculator to Determine What I Can Borrow?

How Can a Mortgage Broker First-Time Buyer Specialist Reduce My Mortgage Costs?

Are There 95 Mortgages for First-Time Buyers or 90 Mortgages for First-Time Buyers?

How Do First-Time Buyer Mortgage Rates Work?

What Are the Essential Factors I Need to Know to Appoint a Mortgage Broker First-Time Buyer Consultant?

Would a First-Time Buyer Mortgage Advisor Recommend a Tracker Deal?

Would a First-Time Buyer Mortgage Advisor Recommend a Tracker Deal?

Can I Get a Buy to Let Mortgage First-Time Buyer?

What Are the Standard First Time Buyer Mortgage UK Fees?

What Are 10 Mortgages for First-Time Buyers?

Am I Eligible for 5 Deposit Mortgages for First-Time Buyers?

Extended Term Best Mortgages for First-Time Buyers

You can go for a longer-term, which will make your monthly payments cheaper as you will spread your payments over a more extended period; however, you will pay more interest overall.

A mortgage is likely to be your biggest monthly outgoing. You must get it right the first time around with the best deal out there suited to your particular needs to keep your monthly payments as low as possible.

We make sure that your mortgage experience is as personal and individual as possible to get a mortgage that fits your needs.

How Much Can I Borrow on a First-Time Buyer Mortgage?

When you apply for a mortgage, lenders determine how much they will lend based on your income and outgoings; thus, the more commitments you have each month, the less you can borrow.

Lenders will generally multiply your income by 4.5 to work out how much they are willing to lend.

If you have an income of £30,000, lenders will generally lend around £135,000 to you. However, mortgage providers will offset this amount against your monthly outgoings.

Can I Use a First-Time Buyer Mortgage Calculator to Determine What I Can Borrow?

Most lenders have a mortgage calculator on their website to determine how much they will lend you.

We also have an up to date mortgage calculator, which can make it clear how much you may be able to borrow and what properties are available to you.

How Can a Mortgage Broker First-Time Buyer Specialist Reduce My Mortgage Costs?

A general rule for mortgages is that the bigger the deposit you have to put towards your mortgage, the lower the interest rate.

For example, if you put down a deposit of 10%, you will generally be looking at a higher interest rate than, say, someone putting down a deposit of 40%.

However, as the Bank of England base rate is at a record low, interest rates are very competitive. Revolution Brokers is here to guide you to the best rate possible for your circumstances.

Are There 95 Mortgages for First-Time Buyers or 90 Mortgages for First-Time Buyers?

The deposit against the mortgage is known as Loan to Value or LTV.

For example, if you put down a 40% deposit, you will have a 60% loan to value against the property.

In this instance, if the house's value were £200,000 and you put down a deposit of £80,000, you would be looking at interest rates with an LTV of 60%, as you will be borrowing 60% of the value of the property.

95% Loan to Values aren't typical, but they are possible with a whole-of-market broker such as Revolution.

Mortgages at 90% are usually more competitive, with lower rates, as the 10% deposit offsets a little more of the lender's risk.

How Do First-Time Buyer Mortgage Rates Work?

There are two payment types for mortgages - repayment and interest only.

  • Repayment - this mortgage is when you pay off the capital owed and the interest on that money each month.

With this mortgage type, you will know that you will have paid off your mortgage at the end of your mortgage term.

  • Interest Only - you only pay the interest on the capital borrowed from the lender.

In this instance, you will not pay off your mortgage at the end of the mortgage term, and you will need to have another repayment vehicle in place when applying for the mortgage, such as savings, an ISA, or plans to sell your property.

However, it is unlikely lenders will allow First-time Buyers to get an interest-only mortgage.

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What Are the Essential Factors I Need to Know to Appoint a Mortgage Broker First-Time Buyer Consultant?

There are several factors that you need to know before you take out your first mortgage, such as:

Initial rate type - what type of rate will you take out once you get the mortgage:

Fixed rates - the lender will set an interest rate for a certain amount of time, such as two years. Fixed-rate deals are the most popular.

They give you peace of mind for the length that your mortgage payments have been fixed for, as you know your mortgage payments will not change for that period.

After your fixed period ends, you will be placed on the lender's Standard Variable Rate (SVR) that is usually a higher interest rate.

Would a First-Time Buyer Mortgage Advisor Recommend a Tracker Deal?

Tracker deals are some of the lowest rates available.

This rate tracks the Bank of England (BoE) base rate, which is now at an all-time low of 0.25% plus a percentage set by the lender you decide to use.

An example of a tracker rate would be the BoE base rate of 0.25% plus another 3%, giving you 3.25%.

First Time Buyer Mortgage Advice When Choosing a Home Loan Product

There are also other variable rates available such as discounted or capped mortgages that give either a discount on the standard variable rate or cap the standard variable rate at a certain amount.

Again, these rates are only for a certain length of time, and then the lender will revert you to their Standard Variable Rate.

Can I Get a Buy to Let Mortgage First-Time Buyer?

While many UK mortgage lenders will prefer buy to let applicants with a history of successful investment property ownership, there is no reason you can't find a great deal as a new landlord.

Give us a call if you're looking for the best rates on buy to let mortgages for first-time buyers, as these can vary substantially throughout the market.

What Are the Standard First Time Buyer Mortgage UK Fees?

Some of the typical charges include:

  • Arrangement Fees

How much is the lender charging you for taking out one of these initial rate types?

It can fluctuate from free for the initial rate type to up to a percentage of your mortgage amount.

  • Valuation Fee

How much is the lender charging you to value the property that you intend to purchase?

  • Stamp duty

You will need to pay stamp duty on properties that are valued at over £125,000.

We will make sure all these costs are affordable before you take out your mortgage so that you can make informed decisions about the best value products.

What Are 10 Mortgages for First-Time Buyers?

A 10% mortgage usually means that the lender is offering to loan up to 90% of the property value - therefore, you need a minimum 10% deposit.

Am I Eligible for 5 Deposit Mortgages for First-Time Buyers?

There are several schemes for First Time Buyers, such as shared ownership schemes and Help to Buy.

Help to Buy means you secure a government equity loan for 20% of the property value. So you can offer a mortgage lender a 25% deposit along with your savings, of a 5% minimum.

If you're unsure whether you're eligible for Help to Buy, please give the Revolution team a call on 0330 304 3040, and we'll discuss how it all works and whether it's the most appealing initiative for your first home purchase.

Check out our handy calculators

Our quick mortgage calculators are designed to give you an indication of how much you can borrow and allow you to consider the different mortgage options available to you.
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FCA disclaimer

The content included in our articles, blogs, web pages and news publications is based on information accurate at the time of writing. Note that policies and criteria can change regularly throughout the UK mortgage lending market, and it remains essential to contact the consultation team to receive up to date guidance. The information included on the Revolution Brokers site is not bespoke to any circumstances or individual application scenarios and therefore is not intended to be used as financial advice. The content we share is designed to be informative and helpful but cannot be relied upon to provide individual advice relevant to your mortgage requirements. All Revolution team members are fully qualified, trained and experienced to provide mortgage advice of an independent nature. We collaborate with lenders and providers who are regulated, authorised and registered with the Financial Conduct Authority (FCA). Should you require specific mortgage borrowing types, some products such as buy to let mortgages may not be FCA regulated. The Revolution team can provide further information about regulated and unregulated lending as required. Please remember that a mortgage is a debt which is secured against your home or property. Your home can be at risk of repossession if you do not keep up with the repayments or encounter any other difficulties in managing your mortgage borrowing responsibly. This also applies to any remortgage or home loan secured against your property, including equity release products.

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