Want to buy your first home but don’t know where to start? Let’s get you on your way to homeownership.
Owning a home has got to be one of the most fulfilling things in life. Yet for a first-time buyer, we get that the process of buying a home can feel like a minefield. What do you need to think about? How do you apply for a mortgage? Can you afford to buy a home?
I’m here to answer your questions, provide useful information and tools, and ease you into the world of mortgages. Knowing a few key things now could:
- Bring you closer to the property ladder.
- Make the process of buying your first home much easier.
- Help you buy your first home with confidence.
We supported 19,000 first-time buyers in 2023 – and we’d love to help you too. Find out about our first-time buyer range.
Before applying for a mortgage
There are things to consider before you start looking for a home. Getting to grips with them beforehand could help you feel clearer about your next steps – and even boost your chances of getting a mortgage.
Firstly, can you get a mortgage?
A mortgage is a big financial commitment. So, any lender will need to know for sure you can afford it.
Your earnings must cover your monthly repayments. Your credit score also plays a big role. And there are other factors, such as the deposit you put down, your employment status, and your monthly spending.
The criteria can vary from lender to lender. To find out more, speak to a member of our mortgage team.
What could you afford to pay on your mortgage each month?
Think about how much you’d feel comfortable paying out – don’t overstretch yourself. You need to make sure you can make your monthly payments, and still have enough money for other expenses. Things like your car, food, utility bills, as well as any outstanding loans or credit cards. And don’t forget, you want to enjoy life too and have money left for hobbies and treats.
It’s also vital to have enough wiggle room for anything unexpected in the future. For example, your mortgage interest rate could go up and cause your monthly payments to rise.
Check how much you could borrow for a mortgage
Build an idea of the mortgage amount a lender might be happy to offer you. This can help you feel clearer about the type of home you could afford.
Doing the maths for this can be tricky. So, to help you, why not try our free and easy affordability calculator. This works out how much you could borrow, based on your monthly income.
Extra costs when getting a mortgage
When it comes to affording a home, it’s not just about the property price. There are extra costs you’ll need to bear in mind, too.
This can range from the arrangement fee on a mortgage product, to valuation fees, legal fees, and stamp duty – down to the cost of hiring a removal van. Totted up, these could prove costly. So, it’s important to be aware and make sure you can fund them.
Our first-time buyer range includes options that could help you with any extra costs you might have.
Getting your credit score up to scratch
Having a decent credit score could boost your chances of getting a mortgage. Unsure what your credit score is? You can check this on websites like Experian, where you might also find tips on how to improve your credit rating.
There are so many ways to improve your credit score, such as:
- Closing any credit accounts that you no longer use.
- Making your repayments on time.
- Taking out a credit card and paying it off each month – if you haven’t borrowed money before.
How much do you need to save for a deposit?
Generally, you need at least a 5% deposit of the property price. Often, the bigger your deposit, the better your mortgage interest rate – and the lower your monthly repayments will be.
Ways to save for a deposit
If you don’t have enough deposit just yet, don’t worry. There are savings incentives for first-time buyers that could help you to build a deposit quicker – such as the Cash Lifetime ISA. With this product, you can pay in to £4,000 each tax year and get a 25% top up from the government, up to a maximum of £1,000 a year.
After taking out a Cash Lifetime ISA with Skipton six years ago, 24-year-old Ed Handford is now a proud homeowner. "My Lifetime ISA has massively helped me onto the property ladder. By maximising my payments to £4,000, I earned an extra £1,000 each year from the government. This helped me save an extra £6,000 for my deposit – speeding up the savings process."
Other options of Lifetime ISAs are available, such as stocks and shares, but your money is at risk. Our Cash Lifetime ISA may be right for you if you’re between 18 and 39 years old, are a first-time buyer, or don’t need access to your savings until the age of 60. If you withdraw before 12 months for your house purchase (or for any other reason before the age of 60), the government will charge you 25%, which means you’d get back less than you paid in.
Applying for a mortgage
Once you’re at a stage where you feel ready to buy a home, it’s important you:
- Feel confident that you can afford to pay off a mortgage each month.
- Have checked your credit score and made sure it’s fine.
- Have saved enough deposit, if you need one, plus any money for extra costs.
As well as helping Ed save towards his first home through our Cash Lifetime ISA, once he was ready to buy, we helped him arrange a mortgage. “Before applying for a mortgage, I didn’t have a clue what to do – but thankfully, Skipton looked after me and explained everything clearly. The process was plain sailing from start to finish – and they kept me updated throughout.”
Ed also received an extra £250 to help with the extra costs of buying a house. Skipton’s Lifetime ISA customers are eligible for this incentive if they complete a mortgage with us (see below for terms and conditions). “It’s not often you get free money to spend on whatever you like, so this was a nice treat that I put towards things like new furniture.”
The next part is knowing what type of mortgage you want
With so many mortgage products to choose from, choosing the type of mortgage you want can help narrow your search and find one that’s right for you.
Types of mortgages
There are two common types of mortgages:
Fixed rate mortgages
your monthly payments stay the same over the term you’ve agreed. This is usually over two, three or five years. Check out our fixed rate products.
Variable rate mortgages
your monthly payments can move up and down throughout the term of your mortgage.
Ways to pay back your mortgage
How you pay off your mortgage is another big decision. The options include:
Repayment mortgage – you pay back the amount you’ve borrowed on your mortgage (the capital), as well as the interest on top.
Interest-only mortgage – your monthly payment only covers the interest charged, not the amount you’ve borrowed. For this type of mortgage, you’ll need proof that you’re able to pay off the amount you’ve borrowed when your mortgage ends.
Getting a Decision in Principle
Before you make your offer on a house, it’s important you have a Decision in Principle. This is confirmation from your lender, which says how much they’re willing to lend you for a mortgage.
Showing this to a seller or estate agent provides assurance that you could get a mortgage – which could boost your chances of having an offer accepted. Once you have a Decision in Principle approved and an offer accepted on a home, you can start your mortgage application with a mortgage adviser.
Your mortgage advice appointment
A mortgage adviser will look at your personal situation and help you find a mortgage deal that’s right for you. Once you’re happy with everything, they’ll start your mortgage application.
Every stage of the application process will be explained to you clearly.
During the application process:
- A team of underwriters will take a deeper look at your affordability and credit history.
- A valuation will be arranged on the property you’re buying – to make sure the amount you’re borrowing is appropriate against its value.
- If your mortgage application is a success, you’ll receive your mortgage offer.
- Next, legal checks will be carried out by your solicitor. Once this has been done, your mortgage will be in place.
Ready to apply for a mortgage?
Let’s get the ball rolling for you.
We’re constantly finding ways to better support first-time buyers like you. Not only do we have a host of great mortgage products on offer – you could benefit from our first-time buyer range.
Your next steps
Double check your affordability
Use our affordability calculator – to check the amount you could afford to pay back based on your income and outgoings.
Get a mortgage Decision in Principle (DIP)
Get a DIP today. We’ll take the information from your affordability calculator, then ask a few extra questions.
Chat to our mortgage team
Once your DIP has been approved, one of our friendly mortgage advisers will be ready to look after you and start your mortgage application.
You can chat to our mortgage advisers over the phone or by our video appointment service – Skipton Link.
You’ll get your own personal mortgage adviser – who will be with you from day one, to when you get the keys to your property.
£250 cashback mortgage terms and conditions
Subject to our normal affordability assessment and lending criteria at the time, Skipton Lifetime ISA customers who are buying their first home with a Skipton mortgage will be eligible for £250 cashback following completion of their mortgage. This offer is only valid for mortgages completed by 30 June 2027. Cashback will be paid for new mortgages where at least one of the applicants is a Skipton Lifetime ISA customer buying their first home. If the mortgage is in joint names and with another Skipton Lifetime ISA holder, only one cashback amount will be paid. Cashback will only be available once.
You could lose your home if you don't keep up your mortgage repayments.
Any questions?
Speak to our mortgage team on