First Time Buyer

In some cases, albeit rare, first time buyers can get 100% mortgages. These products normally require a good rental track record for 12 consecutive months, a clean credit file, proof of income and for the buyer to be aged over 21. However, it is more common for a lender to require anything between 5% and 25% of the value of the property. The more deposit you have as a first time buyer, the more likely you are to secure a competitive rate of interest.

The first time buyer mortgage market is very competitive, offering a variety of options such as:

Fixed-rate mortgages

Fixed-rate mortgages are the most popular amongst first time buyers. They offer a degree of certainty in the early days of a mortgage and are often lower than a mortgage lender’s standard variable rate.

Standard variable rate mortgages

A bank’s standard variable rate is often only available as a reversion rate. This means you move onto it after your fixed rate comes to an end. It is very unusual for a first time buyer to take out a mortgage on standard variable rate.

Tracker rate mortgages

A tracker rate tends to be set at a level above or below the Bank of England’s base rate. For example, if the base rate is 5%, a tracker rate mortgage might sit at 0.5% above base rate, meaning the interest on your mortgage would be 5.5%.

Discount mortgages

Discount mortgage rates are directly linked to the mortgage lenders standard variable rate with an applied discount. The discounted rate could be anything between 0.5% and 4% below SVR. The discount can last anything up to 5 years.

Offset mortgages

An offset mortgage enables you to utilise your savings to reduce how much interest you pay on your mortgage.