This guide is for general information only and does not constitute individual advice. Your home may be repossessed if you do not keep up repayments on a mortgage or other loans secured on it. Miller homes cannot advise you on a mortgage, please consult an independent mortgage adviser for any personalised illustrations

Buying your first home is an exciting milestone, but it also comes with many questions and decisions, especially when it comes to securing a mortgage. This guide will walk you through everything you need to know as a first-time buyer, from what a mortgage is to how much deposit you need.

What is a first-time buyer?

A first-time buyer is someone who has never owned a property before, either as an individual or jointly with someone else. This status can offer certain benefits, like exemption from stamp duty (up to a specific threshold), access to special mortgage deals, and government schemes designed to help first-time buyers get on the property ladder.

What is a mortgage?

A mortgage is likely the largest financial commitment most people make in their lifetime. It’s a loan used to purchase a property, which is then repaid with interest over a set number of years. But before diving into the process, it's important to understand the key details and options available to you.

How do mortgages work?

A mortgage is essentially a loan taken out to buy a property. The loan is secured against the property, meaning the lender (usually a bank or building society) has the right to take possession of it if you cannot repay the loan. Mortgages typically last between 25 to 30 years, though this can vary depending on your financial situation and preferences.

How to get a mortgage as a first-time buyer

If you’re considering buying your first home, one of the first steps is to contact a mortgage advisor (mortgage broker). As a first-time buyer, this is crucial as the whole process will be new to you and they can offer lots of helpful information.

An independent mortgage advisor can improve your chances of getting accepted for a mortgage, since they have access to a wide network of lenders and can match you with one best suited to your circumstances.

Your mortgage advisor will be able to give you a realistic idea of how much you might be able to borrow, and how much you can afford when looking for a property. They’ll help you to get a mortgage in principle, which is a statement from a lender that indicates how much they would be willing to lend you based on an initial assessment.

While not a formal offer, a mortgage in principle is an accurate indication that can help you understand your budget when house-hunting. You’ll need a mortgage in principle before submitting an offer on a property, so it’s best to have this before you set your heart on your dream new home.

To find a trusted mortgage advisor near you, check out our regional panel of independent mortgage advisors.

Once you’ve spoken to a mortgage advisor and know what you can afford, you can start your house search.

What types of mortgage can you get as a first-time buyer?

First-time buyers have access to a variety of mortgage options, each with different features to suit specific financial situations and preferences. Some common mortgage types for first-time buyers include:

Fixed-rate mortgage

With a fixed-rate mortgage, the interest rate stays the same for an agreed period, usually 2, 3, 5, or even 10 years. First-time buyers often prefer fixed-rate mortgages as they are not subject to the rise and fall of interest rates during the fixed rate period.

Variable rate mortgage

The interest rate can change, usually in line with the lender’s standard variable rate (SVR), which is influenced by the Bank of England base rate.

Tracker mortgage

A tracker mortgage's interest rate is linked to an external rate, usually the Bank of England base rate, plus a set percentage.

Discount mortgage

Offers a discount on the lender’s standard variable rate (SVR) for an introductory period, usually 2–3 years.

Guarantor mortgage

A parent or close family member can act as a guarantor, meaning they’ll be responsible for repayments if you can’t pay. Their savings or property may be used as collateral.

Family offset mortgage

A parent or family member puts savings into a linked account, which offsets the mortgage balance, reducing the amount of interest you pay.

Speak to your mortgage advisor to discuss which type of mortgage is best suited to you and your circumstances.

How much deposit will you need?

You’ll typically need a minimum deposit of 5% of the property’s purchase price to qualify for a mortgage. However, some lenders ask for 10% as a minimum amount.

Higher deposits can offer better mortgage terms and give you access to a wider range of lenders, so it’s a good idea to save as much as you can for your deposit. Putting down a higher deposit will also mean that your monthly repayments and total interest that you pay will be lower.

Here’s how much the different deposit amounts look for the UK average house price of £265,000:

Total house price	% Deposit	Deposit amount in £
£265,000	5%	£13,250
£265,000	10%	£26,500
£265,000	15%	£39,750
£265,000	20%	£53,000
£265,000	25%	£66,250

Are you eligible for the First Homes Scheme?

The First Homes Scheme is designed to help first-time buyers and key workers in England purchase homes at a discounted price. To qualify, your total household income must typically fall below a set threshold, which varies depending on your region, and the property must be within an eligible development.

Additionally, you may need to meet other criteria, such as being a resident or having a strong connection to the area where you intend to buy. To check if you’re eligible, visit the official government site or consult with a mortgage advisor who can guide you through the specifics of the application process and available properties.

Do first time buyers pay stamp duty or land tax?

One of the advantages of being a first-time buyer is that you may not need to pay Stamp Duty Land Tax (SDLT) on properties up to a certain value. In England and Northern Ireland, first-time buyers are exempt from SDLT on the first £300,000 of a property priced up to £500,000. If the property costs more than £500,000, normal SDLT rules apply.

Scotland and Wales have their own land tax rules. In Scotland, Land and Building Transaction Tax (LBTT) is payable on properties that cost over £145,000. However, the Scottish Government has introduced tax relief for first-time buyers, which means you only pay LBTT if a property is priced over £175,000. This equates to relief of £600, which can be claimed provided your new home will be your main residence.

Find your first and forever home with Miller Homes

Finding your first home is an exciting journey, and with the right mortgage, it can be a smooth and rewarding experience. At Miller Homes, we understand the importance of making the right choice, whether it’s for your first home or your forever home.

Our dedicated team is here to guide you through every step, helping you secure a mortgage that fits your needs and budget. Find showhomes near you and start your new home adventure today.