First-time buyers' guide

Who is this guide for?

What is in this guide?

If you want an overview before reading our full FTB guide, here's a quick breakdown:

Chapter 1: Is a mortgage is right for you? Can you afford it?

Before you think about applying for a mortgage, consider this: is getting a mortgage right for you? Can you really afford it, or will you struggle to make each payment?

Remember – renting isn't a dirty word. If it's either continuing to save up, or overstretching and having your first home repossessed, it's a no-brainer. This chapter also covers:

• Doing a money makeover and working out what you can afford each month.

• Using our Ultimate Mortgage Calculator to work out how much a mortgage will cost.

• How much lenders tend to let you borrow.

• What 'stress testing' is, why it's important and how it works.

Chapter 2: How big is your deposit?

While 95% mortgages are available if you've only got a 5% deposit, not all lenders offer them. In reality the options will be more numerous and interest rates far cheaper if you've got at least a 10% deposit. This chapter in our FTB guide explains in detail:

• Why the size of your deposit matters.

• How a smaller loan-to-value gets you cheaper mortgage rates.

• Help available if you've a small deposit (such as shared ownership and Lifetime ISAs).

• How guarantor and mates' mortgages work.

See our How much can I borrow? guide for more options if you've got a small deposit

Chapter 3: How to boost your chances of getting a mortgage

Lenders are picky about who they give mortgages to. For example, the best mortgage rates don't just need a good deposit, but a good credit score too. You can boost your score by:

• Getting on the electoral roll.

• Checking your credit file (for free).

• Not missing payments and keeping credit applications down.

We've got the full lowdown on increasing your mortgage hopes in our FTB guide. Plus also check out our Boost your mortgage chances and Improve your credit score guides.

Consider signing up to MSE's Credit Club too. It not only offers free access to your TransUnion credit report, but also provides an estimate of your 'Credit Eligibility Rating'. Plus it'll indicate how much a mortgage lender might let you borrow.

Chapter 4: Decide what type of mortgage you want

Once you're confident a lender will lend to you, you'll need to consider what type of mortgage you want. Our FTB guide explains both what a mortgage is – including how it's 'secured' on your home – and the pros and cons of different mortgage types, such as:

• Repayment and interest-only mortgages.

• Fixed-rate and variable-rate mortgages (such as trackers).

• Offset and guarantor mortgages.

Chapter 5: Getting a mortgage is tougher if you're self-employed

If you're self-employed or a contractor then getting a mortgage is tough as you need solid proof of what you earn. It's easier for employees as they have payslips, but it's harder if you work for yourself or don't have a permanent contract.

Our FTB guide looks at the proof lenders want to see: business accounts, tax returns etc.

Also see our Self-employed mortgages guide for more information if you're in this position.

Chapter 6: Don't forget costs like mortgage fees and stamp duty

It's not just about the price you pay for a property, as there are other things which can add £1,000s to the overall cost. This chapter explains what else to budget for, such as:

• Arrangement fee. Charged by lenders for taking out a mortgage deal – circa £1,000.

• Valuation fee. Charged by lenders for valuing a property – around £300 to £500.

• Legal fees. To cover the cost of all legal work involved. Budget for £800 to £2,000.

• Stamp duty. Paid to HMRC, this fee is based on how much you paid for the property.

Full information on all the costs involved when buying a home is found in our FTB guide.

Chapter 7: How to get a mortgage step-by-step

There are two ways to apply for a mortgage: either going direct to a lender yourself, or applying via a broker. Our FTB guide explains how both options work, but using a broker is often best as they can whittle down top deals quickly, know the type of mortgage that would suit your personal circumstances, and sometimes can access special broker-only deals.

This chapter includes information on:

• How different brokers work and which deals they can access.

• Which brokers are free to use and what questions to ask them.

• How to compare the widest range of mortgages if not using a broker.

Chapter 8: Watch out for the hard sell on insurance

This chapter tells you the insurance policies you may face the hard sell on, what you should expect to pay and how to find the cheapest products. The kinds of insurance include:

• Mortgage payment protection insurance.

• Buildings and contents insurance.

• Life cover.

Chapter 9: First-time buyer Q&A

Will a lender lend on the property? What paperwork do you need to show? How long should you get a mortgage deal for? What does 'annual percentage rate' mean? And can you rent out a property in future? This chapter covers the answers to these and other questions.

Once you've read our First-time buyers' guide, why not check our Mortgage best buys tool?

How comes this guide is free?

This guide is sponsored by fee-free mortgage broker L&C Mortgages. It's had nothing to do with the content, which purely depends on our view of how to get the cheapest mortgage.

Having said that, we've been independently listing L&C as one of the top brokers for many years now in our Cheap mortgage finding guide.

L&C sponsors this guide because it gets a one-time chance to include its own message promoting its service. But there isn't any follow-up advertising, marketing or other malarkey.

This is known as a payment for 'lead generation', and here that means L&C pays for the guide's production and a fee to this site. Read about this site's ethical financial stance.