First-Time Buyer Mortgage FAQ
General information only. This is not financial advice.
Last reviewed: 2026-06-06
Can I get a first-time buyer mortgage if I am self-employed?
Yes. Self-employed first-time buyers face the same lender requirements as any self-employed borrower: most lenders want 2–3 years of SA302s and tax year overviews, though a small number will consider 1 year of accounts. Your borrowing capacity is based on net profit (sole trader), salary plus dividends (limited company director), or a lender-specific blend. Being a first-time buyer does not add restrictions, but it does mean you will need a deposit without equity from a previous property sale, typically from savings, a Lifetime ISA, or a gifted deposit. Get a mortgage-in-principle from a broker before committing to a property search.
Can I apply for a first-time buyer mortgage while on maternity or parental leave?
Yes. Lenders must assess your returning salary, not just your current statutory maternity pay. You will typically need a letter from your employer confirming your return-to-work date and the salary you will return to. Some lenders also include enhanced maternity pay in the current income assessment. If your partner is the primary earner, a joint application may give you greater borrowing power while your income is temporarily reduced. Use a broker who understands parental leave applications — lender policies vary widely.
What government schemes are available for first-time buyers in 2026?
The main schemes currently available are: (1) Lifetime ISA — save up to £4,000/year, receive a 25% government bonus (max £1,000/year), usable on properties up to £450,000. (2) First Homes scheme — a 30–50% discount on new-build homes for eligible first-time buyers, priority for key workers in some areas. (3) Mortgage Guarantee Scheme — government-backed 5% deposit mortgages for properties up to £600,000, currently extended. (4) Shared Ownership — buy 10–75% of a property and pay rent on the rest. Help to Buy equity loan closed to new applicants in 2023. Eligibility conditions apply to each scheme — confirm the current status with your broker as schemes change regularly.
How much deposit do I need as a first-time buyer?
The minimum deposit is 5% of the purchase price on the Mortgage Guarantee Scheme (for properties up to £600,000). Without a government-backed guarantee, most lenders require 10%. A 15% deposit opens significantly more lender options and better rates. A 25% deposit is the threshold for the best LTV pricing from most high-street lenders. For complex income — self-employed, commission-only, variable pay — a larger deposit (15–25%) increases the number of lenders willing to lend and can offset the risk weighting some lenders apply to non-standard income. Gifted deposits from family are widely accepted; document the source and confirm it is a gift, not a loan.
How is bonus or commission income treated for a first-time buyer mortgage?
Lenders typically average the last 2–3 years of bonus or commission income as evidenced by P60s and payslips. Some lenders cap the bonus/commission element at 50% of base salary; others include 100% if consistent. A single exceptional year that inflates the average may be discounted. For commission-only roles (estate agents, sales professionals), some lenders will look at the last 3–6 months of payslips or an employer reference confirming the income is ongoing. As a first-time buyer with bonus or commission income, it is worth having a broker assess your options across the market rather than going directly to one lender.
Does having student loan debt affect my first-time buyer mortgage application?
Yes — student loan repayments reduce your net take-home pay, which directly reduces the amount most lenders will lend you. Repayments are deducted from salary before the lender calculates affordability in most assessments. The size of the impact depends on your income and loan plan: Plan 2 deductions (9% above £27,295) are significant on average graduate salaries. Some lenders use the actual repayment figure; others apply a notional deduction. Paying off the student loan before applying rarely makes sense (the interest rate is low and the foregone capital earns more in savings) — instead, discuss with a broker how to position the application to maximise your borrowing power.
Risk warning
Your home may be repossessed if you do not keep up repayments on your mortgage. Government schemes have eligibility criteria and property price caps that change over time — verify current terms before relying on them.
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