How to get a mortgage as a first-time buyer

Want to understand the full homebuying process from start to finish? For the full steps to buying your first home, read our guide here.

Steps to getting a mortgage:

1. Work out how much you can afford
2. Find out if you can get a mortgage
3. Get all your documents ready
4. Find the right mortgage deal for you
5. Get a Decision In Principle
6. Find a property
7. Get approved for a mortgage
8. Instruct your solicitors
9. Receive your mortgage offer
10. Survey the property
11. Searches and investigations
12. Get house insurance
13. Transfer your deposit
14. Exchange contracts
15. Completion

We've detailed each of these steps below so you know what you need to do at each stage of getting your first mortgage:

How to get a mortgage

1) Work out how much you can afford

To establish how much you can borrow for a mortgage, you should use a Mortgage Calculator to see how much you can borrow based on your household income and deposit savings, or work with a trusted mortgage broker who will take you through an affordability assessment. They'll ask how much deposit you’ve saved and the value of the homes you’ve got in mind.

Keep in mind that calculators can only give you a rough estimate - they don't account for your unique circumstances like credit history, dependents, or outgoings. This is why working with a broker who understands your full picture can help you find solutions that truly fit your situation.

How much can you borrow for a mortgage?

With a traditional mortgage, you can typically borrow between 4 and 4.5 times your household income. But this often isn't enough for buyers, particularly first-time buyers, to get the mortgage they need to buy. Luckily, there are lots of ways to boost what you can afford to borrow.

These first-time buyer schemes include family support options like guarantor mortgages, as well as schemes for those without family support, like mortgages for professionals, NHS or key workers or high earners.

There are also schemes which allow you to buy with no deposit, or only a small amount saved up. These include 100% mortgages, Deposit Unlock, Armed Forces Help To Buy and Shared Ownership.

Working with a mortgage broker like Tembo who specialises in helping buyers boost their affordability, can help you discover alternative buying schemes like these, which can help you buy sooner. See how you could boost your budget today

Read more: Are mortgage calculators accurate?

2) Check if you can get a mortgage

The next step of getting a mortgage is to see if you are eligible for one. While you could go directly to a lender like your bank, you'd only see what that one lender offers - and you might miss out on better deals or specialist products that could boost your borrowing power.

This is where working with a whole-of-market broker makes a real difference. There are lots of lenders out there, including familiar high street banks and newer, innovative providers you might never have heard of. The easiest way to ensure you are applying for mortgages and schemes you are eligible for (and therefore likely to be accepted) is to work with an expert like a mortgage broker - like our award-winning team.

A qualified mortgage broker will search the whole mortgage market to find you the best deal for your circumstances. You don’t have to wait until you’re ready to buy a house, either.

By speaking to an adviser a year or more in advance, they can help you to set a house deposit goal or tell you how to boost the mortgage you’ll be offered by paying off debts and give you advice on how to improve your credit score.

They can also help you get a Mortgage In Principle, which is a simple document that confirms the amount you could borrow for a mortgage. This isn't the same as a mortgage offer, which comes much later. Instead, a Mortgage In Principle shows estate agents that you are in a position to afford a property you're viewing, making you a more attractive buyer. Get started here.

Read more: How to find a good mortgage broker?

3) Gather your documents

A mortgage broker will need your latest three months’ payslips and bank statements to check your affordability - this is to work out what you can afford to borrow for a mortgage. So it's worth getting these documents ready before you chat to your broker.

It's worth noting that if you’re self-employed, you'll need to provide the last three years’ accounts or SA302s, which are statements from HMRC that prove your earnings.

Proof of identification and address is also needed, such as a current passport or driving licence. The same goes for any utility bill or bank statement you’re using to prove where you live.

If you don’t have a passport or driving licence, ring ahead to find out what else you can bring. Without proper ID, you might not be able to proceed with your appointment, so it's worth double-checking you have the right documents before you go.

These days, online copies are widely accepted - in fact, if you book an appointment with us, you can upload these documents to your Tembo account before your call!

It’s also a good idea to order a copy of your credit report from CheckMyFile to take to your meeting. This is a report which shows what debts you have, as well as any credit blips you've had that might affect which lenders will give you a mortgage.

You need to be honest with your broker about any credit issues you’ve had, so they can find a lender which will be willing to accept your mortgage application. The lender will run their own credit checks later on, so being honest about any past slip-ups earlier will save you from potentially being rejected from a mortgage down the line.

4) Find the right mortgage deal for you

It’s time for your mortgage advisor to do their research. Every buyer has their own unique set of circumstances that affects how much they can borrow and which lenders will lend to them. 

Factors such as your age, earnings, financial commitments, how long you’ve been self-employed, and the size and source of your deposit can all impact the deal and the size of the mortgage you’ll be offered.

This is why working with a mortgage broker can be incredibly helpful. They will search from a range of mortgage lenders and products to find the best deals and mortgage rates for you.

For example, at Tembo, we search from over 20,000 mortgage products to find the best deal for each customer. When comparing offers, look beyond the headline rate. Always ask for the Annual Percentage Rate (APR) too, it rolls the interest and all fees into one figure, so you’re comparing apples with apples.

5) Get a Decision in Principle

Once they've found the best deal, your mortgage broker will call you back with the results. If you’re happy with the interest rate, monthly payment and the size of the mortgage, they will then apply to the lender for an Agreement in Principle (AIP). Also known as a Decision in Principle, this is an estimate of what the lender is prepared to offer you and comes in the form of a certificate.

Although it is not a legally binding agreement, it shows the estate agent you’re a serious buyer. When you make an offer on a property, some sellers will refuse to take their property off the market unless you have an AIP. An AIP is typically valid from 30 to 90 days; so if you are a year away from purchase, you are most likely not at the point of needing an AIP.

Read more: Agreement In Principle: What can go wrong?

Armed with your Agreement in Principle, you can now go house hunting and make an offer on your dream home! Remember to consider negotiating the house price before you put your offer in, as this could save you thousands. 

Read more: What to look for when viewing a house?

7) Get mortgage approval

To get approved for a mortgage, you need to submit a full mortgage application through the mortgage lender that gave you the Agreement in Principle. Once the application has been processed, you’ll find out if you have been officially approved. The mortgage broker will manage this process for you using all the information you’ve previously provided (bank statements, etc.).

If any of your circumstances have changed between then and now, such as a change of job, fluctuation in your salary, or you’ve missed your latest credit card payment, you must tell your broker at the point of application. Your lender is about to do a belt and braces check on your credit history and earnings - so now is the time to speak up!

After the mortgage lender receives your application, they'll cross-check it against your income evidence, credit report and bank statements to make sure everything matches up and you meet their lending criteria. At this point, the lender might go back to the broker with further questions or ask for more evidence to support the application.

At the same time, your broker can usually ‘lock’ the interest rate you’ve chosen for a set period (often 3-6 months). This rate lock protects you if rates rise while your application is being processed, giving you certainty over what your monthly payments will look like.

At Tembo, our customers can benefit from our rate checking service for free, which can be super helpful in times when interest rates are changing a lot. Find out more here.

8) Instruct your solicitors

When the lender is satisfied with all your details, they will instruct a surveyor to go out and value the home you want to buy to make sure it’s worth what you are willing to pay for it.

This won't give you a detailed picture of the property's condition, which is why we recommend getting a separate Home Buyer report, which will uncover any issues like subsidence or damp that might need costly repairs. This type of information can be useful to negotiate down the purchase price of the property, and start from around £400.

Tembo customers also have access to our free property reports. Although these are not the same thing as property surveys, they are useful as they aggregate over 240 data points, including instant property valuations, nearby sold prices, floor plans, EPC ratings, schools and more. Find out more here.

9) Receive your mortgage offer

If the bank is happy with the valuation, you’ll be issued a formal mortgage offer. If the lender has concerns about the valuation, they might come back with a lower mortgage offer or, in some cases, decline the application. If this happens, your broker will talk you through your options.

The time it takes from submitting your application to receiving a mortgage offer can be anywhere between two and four weeks. Self-employed borrowers usually have to wait longer than applicants who are employed. Plus, when lenders are extremely busy, it can take from three to six weeks.

A mortgage offer from your lender means they are happy to lend you the money. It is legally binding and usually valid for between three and six months.

While your mortgage offer is in date, the lender will honour the mortgage interest rate they have given you, even if it has been withdrawn for new applications. Lenders will sometimes agree to extend the mortgage offer, depending on the circumstances.

Once you receive your offer, you need to sign and send it back to your mortgage broker ASAP.

Read more: What to do if your mortgage application has been declined?

After this point, your property will be surveyed to check it’s structurally sound, and your solicitor - a.k.a your conveyancer - will begin the legal side of the house purchase, which includes the searches and investigations.

Now is the time to start thinking about house insurance, which your lender will need you to have from the moment you exchange contracts. It's a good idea to start looking early so you don't make a decision in a rush. 

Finally, you’ll come to exchanging contracts - the point of no return in your home purchase journey. In order to exchange contracts, you and the seller needed to have both signed the contract and agreed on a completion date.

Your deposit also needs to have been transferred to your solicitor, and you and the seller have given your respective solicitors final authority to exchange.

Once all those steps are done, the solicitors will ensure all the finances are ready to go, including stamp duty and legal fees.

The final step - completion! Your solicitor will send your deposit and the money from your lender to the seller's solicitors by bank transfer. Once they've received the money, they'll call your solicitors to confirm it's complete!