First Time Buyer

What counts as a first-time buyer?

At Option Finance, we work with first-time buyers every day so we know the rules inside out.

To be classed as a first-time buyer in the UK, you must never have owned a property anywhere in the world not even through inheritance or a gift. If you’ve previously been named on a property title, even if you didn’t purchase it yourself, you won’t qualify under HMRC’s definition.

The main area this matters? Stamp duty. While most mortgage products are open to everyone, first-time buyers can access generous stamp duty discounts especially in England, Northern Ireland, and Scotland.

How much deposit do I need?

Generally, you’ll need at least 5% of the property’s value. But here’s the deal: the more you can put down, the better your options.

That’s because lenders work with something called Loan to Value (LTV). If you put down a 5% deposit, your LTV is 95%. Lower LTV = lower risk = better interest rates.

There are even zero deposit mortgages in some cases, but they’re not always the right fit. Our advisers can talk you through what’s best based on your budget and goals.

How do I get the best first-time buyer mortgage rate?

Rates vary depending on how much you borrow compared to your deposit. Even increasing your deposit by just 1% could unlock a better deal.

But with thousands of products on the market, trying to find the best deal yourself can feel overwhelming.

That’s where Option Finance comes in.

We make it simple by:

• Searching the entire mortgage market for deals that match your goals
• Explaining the fine print so you don’t miss any critical terms
• Handling your application from start to finish
• Giving clear, expert advice on trade-offs (e.g. whether a no-fee mortgage is worth a higher rate)

And the best bit? Our service is completely free. We’re an award-winning mortgage broker built on trust and results.

How much can I borrow as a first-time buyer?

Most lenders offer 4 to 5 times your annual income, but that’s only part of the picture.

They’ll also look at your monthly outgoings, any existing credit, and how stable your income is. That’s why what you can borrow with one lender might look totally different with another.

At Option Finance, we know each lender’s criteria and help you match with the right one—saving you time and stress.

Are there any special schemes or support for first-time buyers?

Yes! There are plenty of options that could make buying your first home easier:

Mortgage options for first-time buyers

• Gifted deposits – Many lenders allow family to help you with your deposit (we’ll guide you on how to structure this)
• Guarantor mortgages – A parent or family member guarantees your repayments if your income alone doesn’t meet the affordability criteria
• Family assisted mortgages – Parents can use their savings as security for your loan, helping you borrow more without needing a traditional deposit

Government & regional schemes

• Shared Ownership – Buy a percentage of a home and rent the rest, then staircase up as you go
• Deposit Unlock – Buy a new-build home with just a 5% deposit (instead of 15%)
• First Homes Scheme (England) – Buy a new home with a discount of at least 30%
• LIFT Scheme (Scotland) and Homebuyer Scheme (Wales) – Regional schemes to help you onto the property ladder

Not sure which option is right? Our advisers will help you figure it out.

What about Stamp Duty?

In England and Northern Ireland, first-time buyers pay:

• £0 Stamp Duty on homes up to £300,000
• 5% on the portion between £300,001 and £500,000
  If your purchase price is over £500,000 or you’re buying with someone who isn’t a first-time buyer, you won’t qualify for the relief.

In Scotland, first-time buyers don’t pay Land and Buildings Transaction Tax (LBTT) on properties up to £175,000.

Ready to get started?

At Option Finance, we specialise in helping first-time buyers turn the dream of homeownership into a plan with expert guidance, no jargon, and zero fees.

Book a free call today and let’s take the first step together.

Get in touch