Understanding the options brokers have to support first-time buyers

It is a challenging time for first-time buyers in the UK, and affordability remains the biggest hurdle for many. While some lenders are stepping up a mortgage price war, with HSBC and the Co-operative Bank recently announcing fresh rate cuts, and Halifax and Lloyds Bank loosening their affordability rules to enable homebuyers to borrow more, this will inevitably increase price pressures. The number of products for borrowers up to 95% LTV has hit a 17-year high. Cheaper borrowing, and more access to credit could see house prices rise, as people can afford to take out bigger loans.

The desire to own our own homes never appears to dissipate and lenders have innovated over the last decade to deliver several options to support people purchasing their first home.

Brokers have a crucial role in supporting first-time buyers by simplifying the complex and having real-time expert knowledge of what is available in the market.

The choice is bewildering. Understanding government schemes such as the Mortgage Guarantee Scheme and shared ownership, as well as keeping abreast of the eligibility criteria, is vital to ensure that clients match what suits their circumstances.

Also, having an awareness of regional affordability trends and new initiatives allows brokers to be able to offer more tailored advice to clients who historically may have been rejected from a mortgage application, due to past credit blips or non-traditional job roles, such as gig workers or freelancers.

While first-time buyers have greater access to information than ever before, and may have an understanding of interest rates and the various government schemes available to them, this does not mean that they have the confidence to navigate the mortgage process alone, and many still rely heavily on brokers for guidance.

It is only by having an up-to-date toolkit of lender options that brokers will be able to offer the most competitive deals for the client and gain the confidence that leads to lasting and trusted relationships.

Here are some of the schemes and options available to brokers.

Gifted deposit

For those lucky enough to have family support, a gifted deposit can help some first-time buyers realise their dream of homeownership sooner than they imagined. 

A gifted deposit is a lump sum that usually comes from a close family member to help cover the deposit on a new home and must be given without the expectation that the money will be repaid. 

Having a larger deposit to put down can help to get first-time buyers access to better mortgage rates and can be the boost they need to get on the property ladder earlier than they had planned. 

Lifetime ISA (LISA)

A LISA is perfect for anyone aged 18-39 who wants to start saving for their first home. A Lifetime ISA is a tax-advantaged savings account designed to help individuals save for their first home or retirement. 

This method of saving allows you to save up to £4,000 each tax year, with the government adding a 25% bonus of up to £1,000 per year. Savers can withdraw the money tax-free to buy their first home with a value of up to £450,000.

First Homes Scheme 

For first-time buyers with an income under £80,000 (£90,000 in London), the First Homes Scheme offers new build homes at a 30%-50% discount, with a priority given to local buyers and key workers.

This does not apply to all new build properties, and there is limited availability, so research into the local developments that support this scheme is essential.

Deposit Unlock

The deposit unlock scheme allows buyers to purchase a new build home with just a 5% deposit, using a mortgage from a participating lender. It is a collaboration between the Home Builders Federation (HBF), mortgage lenders and the housebuilding industry.

The scheme works by having the homebuilder pay a percentage of the purchase price into an insurance policy, which helps reduce the risk for lenders, allowing them to offer higher LTV mortgages.

Shared ownership

This government-backed scheme in the UK allows people to purchase a share in their property while paying rent on the remaining share to a housing association. This helps potential buyers get onto the housing ladder with smaller deposits and lower mortgage costs.

This is a popular and affordable route into home ownership for many first-time buyers.

Mortgage Guarantee Scheme

The MGS can be a lifeline for potential buyers who do not have the means to save a large deposit. 

This scheme enables 95% LTV mortgages by government-backed guarantees to lenders, reducing deposit needs to 5%. The scheme has currently been extended until June 30th 2025, and applies to properties up to £600,000.

Joint borrower, sole proprietor

JBSP mortgages allow up to three family members or friends to contribute income to boost borrowing capacity without co-owning the property. This can be useful when a borrower's personal income is insufficient for a mortgage.

Guarantor mortgages

Guarantor mortgages can help individuals with a low income, little deposit or poor credit to access homeownership. A third party, known as the guarantor, agrees to cover the mortgage payments if the primary borrower cannot. 

The guarantor enters into a legal agreement with the lender, committing to repay the loan if the borrower defaults on the payment. For some people, a guarantor mortgage is the only way to access the property market. 

Right To Buy 

This is a government initiative that allows tenants of council and housing association homes to buy their homes at a discounted price. This allows tenants to become homeowners while receiving a financial benefit based on how long they have lived at the property. 

Looking beyond what we already know...

But aside from specific product types and schemes, there are also now mainstream products that can help first-time buyers' money go further. 3 & Easy is a new range of 97% LTV residential mortgage products from Vida.

The 3 & Easy range includes five and seven-year fixed-rate products, giving customers longer-term stability with their monthly payments. There is also a potential loan term of up to 45 years, assisting customers even further with affordability.

3 & Easy is an ideal option for those who feel trapped in the cycle of paying high rents and are unable to save for a deposit, for young families who are looking to move to a larger and more suitable property.

It removes the often demoralizing lengthy timescales that are often associated with saving up large deposits. This 97% mortgage comes with all of the usual flexible Vida criteria and common sense underwriting, designed to help customers buy their first home sooner using just a 3% deposit (correct as of 19.05.25).

Getting the right help at the right time

It is easy to see why first-time buyers can be easily overwhelmed and understand why good advice is pivotal in this market segment. What’s more, the anticipated boom in new build will mean this sector is as key as any in the market growing over the coming years. The question of which product is right can be the difference between getting a dream start or having a financial nightmare. Brokers have a lot of tools at their disposal.