Your First Mortgage in London — Expert Help, No Fees

First Time Buyer Mortgages in London — What You Need to Know

London's property market is unlike anywhere else in the UK. Higher purchase prices mean larger mortgages, more complex affordability calculations, and a greater need for expert guidance. Getting the right mortgage from the start can save you tens of thousands of pounds over the life of your loan.

At AJM Financial, we specialise in helping first time buyers navigate the London market with confidence. We work with the whole of the market — over 100 lenders — to find the most competitive deal for your deposit, income, and circumstances. And we never charge a broker fee.

How Much Can I Borrow as a First Time Buyer in London?

Most lenders will allow first time buyers to borrow up to 4.5 times their annual income. Some lenders, depending on your income level and credit profile, will stretch to 5 or even 5.5 times income — which can make a significant difference in London where purchase prices are higher.

For example, on a combined household income of £80,000, you could potentially borrow between £360,000 and £440,000 depending on the lender and your circumstances. Your deposit size, existing credit commitments, and any dependants will also affect what you can borrow.

How Much Deposit Do I Need?

The minimum deposit for a residential mortgage in the UK is 5% of the purchase price. However, a larger deposit unlocks meaningfully better interest rates:

• 5% deposit (95% LTV) — accessible, but rates will be higher
• 10% deposit (90% LTV) — significantly better rates available
• 15–25% deposit (85–75% LTV) — access to the most competitive deals on the market

On a £400,000 London property, the difference between a 5% and 10% deposit deal could save you £150–£200 per month — or over £2,000 a year. We'll model the numbers for your specific situation.

Stamp Duty for First Time Buyers in London

From 1 April 2025, first time buyers pay no stamp duty on the first £300,000 of a property's value, and 5% on the portion between £300,000 and £500,000. Properties above £500,000 are subject to standard rates from £1.

On a £450,000 purchase, a first time buyer would pay £7,500 in stamp duty — compared to £12,500 for a standard buyer. Our website includes a stamp duty calculator you can use to check your exact liability.

The First Time Buyer Mortgage Process — Step by Step

• Step 1 — Initial consultation: We discuss your income, deposit, and what you're looking for. Free, no obligation.
• Step 2 — Agreement in Principle (AIP): We obtain an AIP from a suitable lender — a conditional offer of borrowing that estate agents require before accepting offers.
• Step 3 — Property search: You search for properties within your confirmed budget, with your AIP in hand.
• Step 4 — Full mortgage application: Once your offer is accepted, we submit a full application to your chosen lender, handling all paperwork on your behalf.
• Step 5 — Valuation and offer: The lender values the property and issues a formal mortgage offer, typically within 2–3 weeks.
• Step 6 — Exchange and completion: Your solicitor handles the legal process, and you get the keys to your first home.

Frequently Asked Questions