First-time buyer mortgages in the UK are available with a deposit of as little as 5%, but the deposit is only part of the money you need. Between valuation, legal fees, surveys, moving costs and possibly stamp duty, most buyers should budget a further £3,000–£6,000 or more on top — and then there are the monthly costs of actually owning the place.
This guide explains how much deposit you need in 2026, how lenders decide what you can borrow, what the stamp duty rules look like since the April 2025 changes, which schemes genuinely help, and how buyers on Skilled Worker, spouse and other visas can get a mortgage.
This article is general information, not financial advice. Mortgage rates and lender criteria change constantly, so speak to an FCA-authorised mortgage broker or adviser before you commit.
How much deposit do you need as a first-time buyer?
The minimum with most lenders is 5% of the purchase price, giving a 95% loan-to-value (LTV) mortgage. On a £250,000 flat that is £12,500. A handful of lenders offer niche products with smaller or no deposits for renters with a strong payment record or buyers with family backing, but they are exceptions with strict criteria.
A bigger deposit buys you a lower interest rate, because lenders price in LTV bands — 95%, 90%, 85%, 80%, 75% and 60%. Moving from a 5% to a 10% deposit usually cuts the rate noticeably and opens up far more lenders; it also gives you a cushion against falling prices and negative equity. Many new-build flats need at least 10%, and some lenders cap LTV lower on flats than on houses.
| Deposit on a £250,000 home | Amount | Mortgage needed | What it means |
|---|---|---|---|
| 5% | £12,500 | £237,500 | Fewest lenders, highest rates, tighter affordability checks |
| 10% | £25,000 | £225,000 | Wider choice and better pricing; the practical target for many buyers |
| 15% | £37,500 | £212,500 | Further rate improvement; accepted by many lenders for visa holders |
| 25% | £62,500 | £187,500 | Access to some of the best mainstream rates |
The government-backed Mortgage Guarantee Scheme, made permanent in 2025, encourages lenders to keep offering 91–95% LTV mortgages by insuring part of their risk. You do not apply for it separately and it does not make your mortgage cheaper; it simply keeps 5% deposit deals on the shelves.
How much can you borrow?
Lenders typically offer around 4 to 4.5 times household income, with some going to 5 or 5.5 times for higher earners, certain professions or dedicated first-time buyer products. Regulators loosened some affordability rules during 2025, so a few lenders have become more generous, but the income multiple is only a ceiling. The real test is an affordability assessment of your income against your outgoings: loans, car finance, credit cards, childcare, and any money you send abroad regularly.
Your credit file matters too. Register on the electoral roll if you are eligible, keep card balances low, and check your reports with Experian, Equifax and TransUnion before applying. If your file is thin because you are new to the country, see our guide on how to build a credit score.
What about interest rates?
As of 2026, typical two- and five-year fixed rates have sat broadly in the 4–5.5% range depending on LTV, with 95% deals at the top of that band. Rates move with Bank of England decisions and market expectations, so check a live comparison or ask a broker. Fixed rates give payment certainty; trackers follow the base rate up and down. Whichever you choose, put the end date in your diary — when a deal ends you move to the lender’s standard variable rate, which is usually much higher. We cover rate-shopping tactics in our guide to getting a mortgage at a low interest rate.
Stamp duty for first-time buyers in 2026
In England and Northern Ireland, first-time buyer relief on Stamp Duty Land Tax changed on 1 April 2025, when the temporary higher thresholds ended. At the time of writing:
- You pay no stamp duty on the first £300,000.
- You pay 5% on the portion from £300,001 to £500,000.
- If the price is above £500,000, the relief does not apply at all and you pay standard rates on the whole purchase.
- Everyone buying must be a first-time buyer, meaning none of you has ever owned a home anywhere in the world.
So a £280,000 home costs nothing in stamp duty, while a £400,000 home costs £5,000. Buyers who have not been UK resident for at least 183 days in the 12 months before purchase pay a 2% non-resident surcharge, which matters for people buying shortly after arriving.
Scotland and Wales have their own taxes. Scotland’s Land and Buildings Transaction Tax gives first-time buyers a higher nil-rate band of £175,000. Wales’s Land Transaction Tax has no first-time buyer relief, but its starting threshold of £225,000 covers many first homes. Use the official calculators on gov.uk, Revenue Scotland or the Welsh Revenue Authority for an exact figure.
What fees should you budget for?
| Cost | Typical range in 2026 | Notes |
|---|---|---|
| Mortgage arrangement (product) fee | £0–£1,999 | Can often be added to the loan, but you then pay interest on it |
| Mortgage broker fee | £0–£600 | Many brokers are paid by the lender; always ask |
| Valuation fee | £0–£500 | Frequently free on first-time buyer deals; it is for the lender’s benefit, not yours |
| Survey (Level 2 or Level 3) | £400–£1,500 | Optional but strongly advised, especially for older properties |
| Conveyancing (solicitor or licensed conveyancer) | £1,000–£2,000 plus VAT | Leasehold purchases cost more |
| Searches and disbursements | £300–£500 | Local authority, water and environmental searches, bank transfer fees |
| Land Registry fee | Roughly £20–£500 for most first homes | Scaled by price |
| Removals and basic furnishing | £400–£2,000+ | Depends on distance and volume |
| Stamp duty | £0 up to £300,000 with relief | See above |
Ongoing housing costs
Owning costs more than the mortgage payment. Budget for council tax, buildings insurance (a condition of the mortgage for freehold homes), contents insurance, energy and water, and maintenance — a common rule of thumb is 1% of the property’s value per year. Leaseholders also pay service charges and sometimes ground rent, which can run to thousands a year in blocks of flats; check the lease length, as many lenders are wary of anything under about 80 years. Life insurance or income protection is worth considering once others depend on your income. Our guide to lowering your home insurance premium has practical tips.
Which first-time buyer schemes are worth knowing?
Lifetime ISA
If you are aged 18 to 39 you can open a Lifetime ISA and save up to £4,000 a tax year, with the government adding a 25% bonus — up to £1,000 a year. You can use it towards a first home costing up to £450,000, provided the account has been open for at least 12 months and you buy with a mortgage. Withdrawing for any other reason before 60 triggers a 25% charge, which means you get back less than you put in. The government has been consulting on reforming ISA products for first-time buyers, so check the current rules on gov.uk.
Shared ownership
With shared ownership you buy a share of a home — usually between 10% and 75% — from a housing association, and pay subsidised rent on the rest. Your deposit is 5–10% of your share, not the full price, which slashes the cash needed up front. Household income must be £80,000 or less (£90,000 in London). You can buy more shares later (“staircasing”). The drawbacks are real: you pay rent, mortgage and full service charges, the homes are leasehold, and selling can be slower. Read the lease carefully.
First Homes and other local schemes
The First Homes scheme in England offers new-build homes at a discount of 30–50% to local first-time buyers and key workers, with the discount passed on at resale, but availability is limited. The Help to Buy equity loan has closed to new applicants in England; Wales and Scotland run their own programmes, and local councils sometimes offer discounted sale or rent-to-buy homes. The “Own Your Home” pages on gov.uk list what is currently open.
Help from family
A gifted deposit is the most common boost; lenders will want a signed letter confirming it is a gift, plus proof of where the funds came from. Money from overseas faces extra anti-money-laundering checks, so gather bank statements early and use a regulated transfer service. Alternatives include joint borrower, sole proprietor mortgages, where a parent’s income supports the application without them going on the deeds.
Can visa holders get a first-time buyer mortgage in the UK?
Yes. There is no legal bar on foreign nationals buying property, and many mainstream lenders lend to people on Skilled Worker, Health and Care Worker, Global Talent, spouse and other visas. Criteria vary widely between lenders, which is where a broker earns their fee. Common requirements include:
- Time in the UK: often at least 12 months’ to 2 years’ residence, though some lenders have no minimum for higher earners.
- Time left on your visa: some lenders want a minimum remaining period, others do not mind as long as the visa is valid.
- A larger deposit: several lenders accept 5–10% from visa holders who meet their residence and income rules, while others ask for 15–25%.
- A UK bank account, UK employment and a UK credit history. Permanent contracts are easiest.
Once you have indefinite leave to remain or settled status, lenders treat you like any other UK resident. Remember the 2% stamp duty surcharge if you have recently arrived. If you are still planning your move, our guides to the UK spouse visa and affordable UK housing for immigrants cover the visa and renting stages that usually come first.
How to get a first-time buyer mortgage, step by step
- Check your credit reports and fix errors.
- Work out your full budget: deposit plus fees plus a reserve of at least three months’ outgoings.
- Speak to a whole-of-market mortgage broker. Confirm they are authorised on the Financial Conduct Authority Register at fca.org.uk.
- Get an agreement in principle. It normally uses a soft credit check and shows estate agents you are serious.
- Make an offer and instruct a conveyancer as soon as it is accepted.
- Submit the full mortgage application with payslips, bank statements, ID, proof of deposit and, if relevant, your visa or eVisa share code.
- Book a survey, review the results and renegotiate if needed.
- Exchange contracts — you pay the deposit and are legally committed — then complete and collect the keys.
In England and Wales the process commonly takes three to four months from accepted offer; Scotland’s system of legally binding missives is usually faster. Free, impartial guidance on every stage is available from the government-backed MoneyHelper service.
Frequently Asked Questions
Am I still a first-time buyer if I own a property abroad?
No. For stamp duty relief and the Lifetime ISA, you must never have owned a residential property anywhere in the world. Some lenders’ own first-time buyer products use a looser definition, but the tax rules do not.
Can I buy with a partner who has owned before?
You can buy together, but you will lose first-time buyer stamp duty relief, because every purchaser must qualify. Your own Lifetime ISA can still be used if you personally are a first-time buyer.
Is a 5% deposit mortgage a good idea?
It gets you on the ladder sooner, but at a higher rate and with little equity buffer if prices fall. If you can reach 10% within a year or so without hardship, the saving in interest is often worth the wait.
Should I choose a two-year or five-year fix?
A two-year fix lets you remortgage sooner, ideally at a lower LTV; a five-year fix gives longer certainty and fewer remortgage fees. Consider how long you expect to stay in the property and how you would cope if rates were higher when the deal ends.
Do I need a mortgage broker?
Not legally, but a good whole-of-market broker is especially useful if you are self-employed, on a visa, have a small deposit or have a patchy credit history, because they know which lenders accept which circumstances.
Bottom line
First-time buyer mortgages in the UK start at a 5% deposit, but 10% is the more comfortable target, and fees add several thousand pounds. Use the Lifetime ISA bonus if you are under 40, check whether stamp duty relief applies at your price, consider shared ownership if your income fits, and — particularly if you hold a visa — let an FCA-authorised broker match you with a lender whose criteria you actually meet.