First Time Homebuyer Guide: What You Need to Know Right Now

Buying your first house can feel like solving a puzzle you’ve never seen before. The good news? Most of the pieces are simple once you know where they fit. Below you’ll find the essential steps, from saving that first deposit to picking the right mortgage, all explained in plain English.

How Much Do You Really Need for a Down Payment?

Most first‑time buyers think they need 20% of the purchase price, but that’s a myth. In the UK, many lenders accept as little as 5% down if you qualify for a Help to Buy or shared ownership scheme. For a £200,000 home, that means you could start with £10,000 instead of £40,000. However, the smaller the deposit, the higher your monthly payments usually are, so balance what you can afford now against what you’ll pay later.

Here’s a quick way to estimate your deposit:

• 5% deposit = £10,000 on a £200,000 property
• 10% deposit = £20,000 – often unlocks better mortgage rates
• 15% deposit = £30,000 – can shave a few percent off your interest

Ask yourself: can you comfortably save the higher amount without stretching your budget? If not, look into government assistance programs that match part of your contribution.

Credit Score and Mortgage Options Made Simple

Your credit score is the gatekeeper for most mortgage offers. Lenders look for a score above 620 for standard deals, but the sweet spot is 720‑740, where you’ll see the most competitive rates. If your score is lower, consider these steps:

1. Pay down any credit‑card balances – keep utilization under 30%.
2. Check your credit report for errors and dispute any mistakes.
3. Settle any missed payments and let them age; newer positive activity outweighs old negatives.

While you’re improving your score, start talking to a mortgage adviser. They can run a “mortgage in principle” check, which tells you roughly how much you could borrow without a full application. It’s a free way to gauge your buying power and shows sellers you’re serious.

Don’t forget about the different loan types:

• Fixed‑rate mortgages lock your interest for 2‑5 years – great if you like predictable payments.
• Variable‑rate mortgages can drop if the Bank of England cuts rates, but they can also rise.
• Help to Buy ISAs let you save tax‑free and claim a government bonus when you buy.

Pick the one that matches your risk comfort and how long you plan to stay in the home.

Finally, remember the hidden costs. Stamp duty, legal fees, survey costs and moving expenses can add up to 5‑10% of the purchase price. Build a small buffer into your budget so you’re not caught off‑guard on closing day.

Ready to start? Grab a spreadsheet, set a realistic monthly saving goal, and schedule a chat with a local mortgage adviser. The more you know now, the smoother the journey to your first front door will be.