You’ve Decided to Take the Leap—What’s Next?
I’ve been helping people secure mortgages for over 30 years. Here’s my concise guide to the 7 key steps for getting your first UK mortgage.
Step 1: Check Affordability
First, calculate how much you can borrow to determine your max purchase price. For employed income with good credit, expect around 5x your gross salary.
Other income types can boost borrowing, but lenders vary on acceptance—proof of regularity is key (e.g., payslips, tax returns). Often, only 50-100% counts based on consistency.
- Overtime Pay: Included if regular; 100% if consistent, else 50%.
- Bonuses and Commissions: Accepted if ongoing; averaged over 1-2 years, 50-100% used.
- Allowances: Car or shift perks count at 100% if guaranteed.
- Self-Employed/Freelance Earnings: Averaged over 2-3 years via SA302 forms.
- Zero-Hour/Second Job Income: With 12+ months’ proof; often 50% due to variability.
- Pension Income: Regular pensions fully counted; flexible ones limited.
- Investment Income: Dividends/interest if documented; portion used if not guaranteed.
- Rental/Lodger Income: Via Rent a Room scheme; may offset commitments.
- Government Benefits/Tax Credits: Stable ones like Child Benefit; varies by lender.
- Maintenance Payments: Court-ordered and regular; 100% if consistent.
- Trust/Non-Taxable Income: With documentation; depends on reliability.
Other Affordability Factors
You might get less than 5x if credit is poor, liabilities high, or age requires a shorter term. Some lenders offer more:
- Nationwide: Up to 6x for 5% deposit FTBs.
- Santander: 5x for £45k-£99k earners; 5.5x over £100k with 25% deposit.
- Barclays: 5.5x under 85% LTV for £75k+ earners.
- HSBC: 6.5x for Premier clients up to 90% LTV.
Estimate borrowing with the Halifax Mortgage Calculator or consult a mortgage broker.
Afford Now and Later
Ensure payments are sustainable, including potential rate hikes. Check your mortgage illustration for rate increase impacts.
For a £200k mortgage at 4% over 25 years: ~£1,056/month. At 6% after 2 years: ~£1,273/month (+£217).
Lowering Payments
Seek advice from a mortgage professional before these options:
- Higher Fee for Lower Rate: Savings must outweigh fees; adding to loan increases interest.
- Extend Term: To age 75 (e.g., Santander/Halifax). Reduces monthly but adds interest—e.g., £126k vs. £192k on £200k at 4% (25 vs. 40 years). Delays equity; extends into retirement.
- Interest-Only: Lowers payments but doesn’t repay capital—best for bonus-heavy income; repayment mortgages are safer for FTBs.
Upfront Costs Summary
Make sure you understand and can afford upfront costs—on average ~£33k for FTBs in 2025 (beyond deposit):
- Deposit: 5-20% (~£55k average).
- Stamp Duty: £0 under £425k for FTBs.
- Legal Fees: £1k-£2k.
- Survey: £300-£1.5k.
- Arrangement Fees: £500-£2k.
- Other: Broker (£0-£500), moving (£500+).
Pay upfront to cut long-term interest.
Step 2: Secure Your Deposit
Get help from the Government with these Help to Buy alternatives:
- Mortgage Guarantee: 5% deposits via government-backed 95% LTV.
- Shared Ownership: Buy 10-75%, rent rest (up to £600k London/£250k elsewhere).
- Lifetime ISA: 25% bonus on up to £4k/year savings (under-40s, homes <£450k).
- First Homes: 30-50% discount on new-builds (£420k London/£250k cap).
- Forces Help to Buy: £25k interest-free loan (50% salary) for Armed Forces.
- Regional: Wales/Scotland equity loans (20-40%).
Eligibility includes income caps.
Guarantor Options
Get help from your parents who can provide security without ownership (JBSP preferred for tax):
- Barclays: Family Springboard (savings as 100% LTV security).
- Gen H: Family income boost.
- Skipton: Track Record for low deposits.
- Loughborough: Family Assist.
- Nationwide: Higher borrowing support.
- Cambridge: Guarantor products.
- Chorley: Guarantor deals.
- Dudley: Family options.
Step 3: Check Your Credit Score
Use CheckMyFile for aggregated reports from Equifax, Experian, and TransUnion, plus improvement tools.
Step 4: Select Mortgage Type
Rate Types
- Fixed-Rate: Stable rate (2-10 years) for budgeting.
- Variable-Rate: Fluctuates; sub-types:
- SVR: Lender’s default, changeable.
- Tracker: Follows BoE base + margin.
- Discounted: Off SVR initially.
- Capped: Variable with max limit.
Repayment Types
- Repayment: Pays interest + capital; full ownership at end.
- Interest-Only: Interest only; repay capital later (stricter, often buy-to-let).
Specialist Types
- Buy-to-Let: For rentals.
- Let-to-Buy: Rent current home, buy new.
- Holiday Let: Short-term rentals.
- Offset: Savings reduce interest.
- Joint: Multi-borrowers.
- Guarantor: Family backs loan.
- JBSP: Family income, sole ownership.
- Self-Employed: Via accounts/SA302.
- Help to Buy/Shared Equity: Government loan.
- Shared Ownership: Partial buy/rent.
- Lifetime (Equity Release): Over-55s.
- Green: Eco incentives.
- Track Record: Rental history proof.
Step 5: Get an Agreement in Principle (AIP)
Obtain provisional lender acceptance. Confirms borrowing (subject to valuation) and boosts offer acceptance chances.
Research shows 90-95% of AIPs lead to approval, making offers more likely accepted (source). Signals seriousness, reduces chain risks.
Step 6: Choose Lender & Solicitor
See comparisons for lenders; use an experienced mortgage adviser to find the best.
For solicitors: Panel (streamlined, less personal) vs. Bespoke (tailored, potentially slower/costlier).
Costs (~£273k purchase): Panel £1.2k-£1.8k (~£1.5k avg); Bespoke £1.5k-£2.5k (~£2k avg).
Top picks:
- Juno: 4.9/5, £800-£1.2k fees; efficient online.
- Premier Property Lawyers: 4.7/5, £900-£1.4k; reliable panel.
- PLS Solicitors: 4.6/5, £1k-£1.6k; dedicated bespoke.
Step 7: Apply, Offer, Complete
Submit application, get offer, complete purchase. Use a broker for a smooth process.