Your First Time Buyer Guide

Most lenders will let you borrow between 4 and 4.5 times your annual income. Some will stretch to 5 or even 5.5 times for higher earners or certain professions like doctors, solicitors, and accountants. If you are buying with someone else, both incomes are taken into account.

Affordability is not just about income. Lenders also look at your monthly outgoings, existing debts, credit commitments, and living costs. They stress test your ability to pay at a higher interest rate to make sure you could still afford the mortgage if rates went up.

The minimum deposit is 5% of the purchase price. On a property worth £250,000, that is £12,500. However, the more you put down, the better the interest rates you will be offered.

Your deposit can come from savings, a gift from family, a Lifetime ISA (with the 25% government bonus), or the sale of another asset. Lenders will want to see a clear paper trail of where your deposit came from.

• Fixed rate: Your interest rate stays the same for a set period (typically 2, 3, or 5 years). Your monthly payments do not change, which makes budgeting easier. This is the most popular choice for first time buyers.
• Tracker rate: Your rate moves up and down with the Bank of England base rate. You benefit when rates fall but pay more when they rise.
• Variable rate: Set by your lender and can change at any time. These are less predictable than trackers.
• Discount rate: A set discount below the lender's standard variable rate for a fixed period. The rate can still change because the underlying SVR can move.

Most first time buyers choose a fixed rate for the security of knowing exactly what they will pay each month.

1. Get an agreement in principle. This tells you how much a lender is willing to offer and shows sellers you are serious.
2. Find a property. Start viewing homes within your budget. Take your time and do not rush into a decision.
3. Make an offer. If you find the right property, put in an offer through the estate agent.
4. Instruct a solicitor. Once your offer is accepted, appoint a solicitor to handle the legal work.
5. Submit your full mortgage application. Provide your documents and wait for the formal offer.
6. Get a survey. Commission a survey to check the condition of the property.
7. Exchange contracts. The sale becomes legally binding and you pay your deposit.
8. Complete and collect the keys. The mortgage funds are transferred and the property is yours.

Budget for at least £3,000 to £5,000 on top of your deposit for the various fees and costs. Your broker can give you a more precise estimate based on your situation.

• Lifetime ISA: Save up to £4,000 per year and the government adds a 25% bonus (up to £1,000 per year). Available to anyone aged 18 to 39.
• Shared Ownership: Buy a share of a property (between 25% and 75%) and pay rent on the rest. You can increase your share over time.
• First Homes: New build properties offered at a discount of at least 30% to first time buyers and key workers.
• Stamp Duty relief: First time buyers pay no Stamp Duty on the first £300,000 of properties worth up to £500,000.