The more you can save for your deposit, the less you need to borrow and the better the mortgage rates you will be offered. Here is a clear breakdown of what different deposit sizes mean for you:
Many buyers turn to online calculators for an initial idea of affordability, but these tools are often inaccurate, particularly for first time buyers whose situations can be more nuanced (variable income, more than one income source, unusual employment types and so on). Our advisers assess your actual borrowing capacity based on your specific income, outgoings, credit profile and the criteria of individual lenders. That gives you a real, reliable figure rather than a ballpark estimate.
Important: The monthly repayment you pay depends on three things: how much you borrow, the interest rate offered and the length of your mortgage term. With rates higher than they were a few years ago, it is essential to get an accurate repayment figure before you start viewing properties, so you can set a realistic budget.
How Does Mortgage Term Affect Monthly Payments?
The average mortgage term is 25 years, but many lenders now extend this to 35 or even 40 years, provided you will still be below their maximum age at the end of the term. A longer term means lower monthly repayments but more interest paid in total. Your adviser will help you find the right balance.
A mortgage is not the only expense when buying your first home. Before you begin viewing properties, make sure you've planned for these one-off upfront costs:
Ongoing Costs Once You Move In
Beyond the mortgage payment itself, homeownership comes with regular ongoing costs you should plan for from day one:
Our advisers always walk through a full budget planner with you before any application is submitted, making sure you are comfortable with both the mortgage payment and the wider financial picture of owning a home.
The deposit gets all the attention, but it is the other first time buyer costs that catch people out: the fees that fall due before you even have a mortgage offer, the legal bill, the tax, and the cost of actually moving in and setting up a home. Here is everything we ask clients to budget for, in the order the money leaves your account, with typical figures from the cases we see in 2026.
An Agreement in Principle costs nothing. Once your offer on a property is accepted the spending starts. Some lenders charge a booking fee of £99 to £250 to reserve a deal, and it is usually not refundable if the purchase collapses. The lender's valuation fee ranges from free to around £500 depending on the property price. Then there is your own property survey: a Level 2 HomeBuyer report is typically £400 to £900, and a Level 3 building survey for an older first house with possible structural issues can be £600 to £1,500. None of this is wasted money; a survey that finds damp or a dodgy roof can save you thousands in negotiation.
The arrangement or product fee is the big one, anywhere from zero to £1,999, and it buys you a lower interest rate. Whether it is worth paying depends on the loan size, which we work out for every mortgage deal we compare. Add the booking fee and valuation fee above, and a telegraphic transfer fee of £20 to £45 when the funds are released. The fee you will not pay with us is a broker fee: our advice is fee free for standard residential cases because the lender pays us on completion.
Conveyancing is the legal process of transferring the home into your name, and for a freehold purchase the legal work plus disbursements (searches, Land Registry fees, bank transfer, ID checks) usually comes to £1,500 to £2,500. A leasehold property costs more because of the extra legal issues in the lease. Our solicitors, insurance and protection guide breaks solicitor fees down to the pound.
In England and Northern Ireland, first time buyer relief on Stamp Duty Land Tax currently means nothing to pay up to £300,000 and 5% on the slice between £300,001 and £500,000. Buy in Scotland and you pay Land and Buildings Transaction Tax to Revenue Scotland, with its own first time buyer threshold; the seller also has to provide a Home Report, which saves you the survey cost. In Wales, Land Transaction Tax applies with no first time buyer relief. Our stamp duty calculator covers all three nations.
A removal van with a crew is £300 to £1,500 depending on distance and how much you own; hiring a van and roping in friends is a few hundred pounds. Then the things a rental came with: white goods, curtains, a bed, broadband installation, and the first council tax and utility bills, which are due whether or not you have unpacked. We suggest clients hold back at least £2,000 for this, because arriving in your new home with an empty account is a miserable start.
If your first home is a flat you will pay service charges for maintaining the building and communal areas, possibly ground rent, and a share of any major works. Lenders deduct these from your affordability, so a £200 a month service charge can cut what you can borrow by several thousand pounds. Ask for the last three years of accounts before you offer.
Cost
Typical range
Example on a £250,000 first home
Deposit (5% to 10%)
Depends on the property price
£12,500 to £25,000
Mortgage arrangement fee
£0 to £1,999
£999 (or added to the loan)
Valuation and booking fees
£0 to £750
£250
Property survey
£400 to £1,500
£550 (Level 2)
Legal fees and disbursements
£1,500 to £2,500
£1,800
Stamp Duty Land Tax
£0 up to £300,000 with first time buyer relief
£0
Removals and setting up
£500 to £3,000
£1,500
Broker fee
£0 with us for standard cases
£0
In this example a buyer with a 5% deposit needs roughly £17,600 in total, or about £30,000 with a 10% deposit. Figures are typical ranges for illustration only and vary depending on the property, the lender and where you buy.
Income multiples are the starting point, usually 4 to 4.5 times your gross income, with some lenders going to 5 or 5.5 times for the right profile. Then the lender models your outgoings: credit cards, car finance, student loan, childcare and the service charge on a flat all reduce the figure. Finally they stress test the monthly mortgage repayments at a higher rate than you will actually pay, to check you could cope if rates rose. Two people on the same salary can get very different answers depending on their commitments, which is why our borrowing calculator is a starting point and an Agreement in Principle is the real answer.
Mortgage repayments come first, then buildings and contents insurance, life or income cover if you take it, council tax, energy, water and broadband. We also suggest putting aside around 1% of the property value each year for maintenance, because boilers, gutters and storm damage do not wait until you have saved up. Our mortgage repayment calculator gives you the headline figure; the rest is the reason we run a budget planner with every client.
A larger deposit moves you into a cheaper loan to value band and a lower interest rate. A Lifetime ISA adds a 25% government bonus to deposit savings. Fee free mortgage deals and cashback offers can cover the valuation and legal costs. Compare solicitor quotes like for like. Negotiate on price if the survey finds problems. And use a fee free broker: on a £250,000 purchase the broker fee some firms charge is money you can put towards the removal van instead.
In England and Northern Ireland, not on the first £300,000 of the price, and 5% on the part between £300,001 and £500,000. Above £500,000 the relief is lost entirely. Wales has no first time buyer relief and Scotland has its own threshold.
The arrangement fee usually can be, although you pay interest on it for the whole term. Legal fees, stamp duty and your deposit cannot; they have to come from savings, a gift or a Lifetime ISA.
You lose whatever has been spent on searches, the survey and any non-refundable booking fee, typically £500 to £1,500. A no completion, no fee agreement with your solicitor limits the legal cost, and we never charge for our time.
Yes, plenty of lenders offer 95% mortgages, helped by the mortgage guarantee scheme. Rates are higher than at 10% or 15%, so if you are close to the next band it can be worth a few more months of saving. See our 5% deposit mortgages page.
Want a personal budget rather than a typical one? Get in touch on 03300 432 428 and we will go through every cost for your purchase, or read on about the mortgage types you will be choosing between.
Your home may be repossessed if you do not keep up repayments on your mortgage. Cost figures are typical ranges for illustration only.
Speak to one of our fee free mortgage advisers today. We will work out your affordability, explain your options in plain English and help you move forward with confidence.
