For many people, getting a mortgage can feel like something that is only possible if your finances are completely straightforward.
A perfect credit history. A large deposit. A stable job. No overdraft. No existing debt.
But the reality of the mortgage market is more nuanced.
Recent research from Lloyds highlights just how many potential first-time buyers are making the decision that they won’t qualify before they have even spoken to a lender or mortgage adviser.
The research found that 58% of first-time buyers rule themselves out of getting a mortgage before applying.
That matters because some of the things people believe automatically prevent them from getting a mortgage may not necessarily do so.
The myths that could be stopping potential buyers
According to the Lloyds research, 58% of first-time buyers incorrectly believed that having existing debt would prevent them from being approved for a mortgage.
Other common concerns included:
- 40% believed being in an overdraft would stop them getting a mortgage.
- 38% believed receiving benefits would prevent them from being approved.
- 31% thought changing jobs recently meant they would automatically be rejected.
- 30% believed they needed a perfect credit score.
- 24% thought being self-employed would automatically mean a mortgage rejection.
- 37% believed a 20% deposit was essential.
These figures demonstrate an important point: there can be a big difference between what someone thinks a lender will say and what a lender may actually be prepared to consider.
That doesn’t mean everyone will qualify for a mortgage. It means that it can be a mistake to make that decision yourself without first understanding your options.
A significant market of potential first-time buyers
The first-time buyer market remains substantial.
In 2024, 341,068 first-time buyers stepped onto the UK property ladder, an increase of 19% compared with 2023. First-time buyers accounted for 54% of all home purchases made with a mortgage, the highest proportion recorded in the Halifax data.
The market has changed considerably over recent years.
First-time buyer numbers over recent years
- 2021: 405,250 first-time buyers — a post-pandemic peak.
- 2022: 369,870.
- 2023: 287,060 — a significant fall as interest rates and mortgage costs increased.
- 2024: 341,068 — a 19% recovery from 2023.
The broader picture is therefore one of a large market that has experienced considerable pressure from affordability, interest rates, house prices and deposit requirements, but which has also shown signs of recovery.
Looking beyond annual mortgage-backed completions, estimates for the broader group of recent first-time buyers — people who have bought within the last three years — put the number in England at roughly 850,000 to 965,000.
That is a substantial number of people navigating the mortgage market, each with their own financial circumstances.
What does the typical first-time buyer look like?
The idea of a “typical” first-time buyer is also changing.
Halifax’s 2024 figures put the average age at 33, two years older than a decade earlier. The typical first home cost £311,034, while the average deposit was £61,090, equivalent to around 20% of the purchase price.
Buying jointly is also common. Around 62% of mortgage completions in 2024 were in two or more names, as buyers combined incomes to help make affordability work.
For many people, these numbers can make becoming a homeowner feel increasingly difficult.
But the figures don’t tell the whole story.
What if you have had credit problems?
This is where getting the right advice can be particularly valuable.
Someone who has experienced financial difficulty in the past may assume that their mortgage prospects have disappeared altogether.
Perhaps you’ve had missed payments.
Perhaps you’ve had historic arrears.
Perhaps you’ve used an overdraft or had higher levels of unsecured borrowing.
Perhaps your credit history isn’t as clean as you’d like.
Or perhaps your circumstances are simply more complicated than those of the “standard” mortgage applicant.
A credit challenge doesn’t necessarily mean a mortgage is impossible.
Mortgage lenders have different criteria, and they assess applications according to their own policies and affordability requirements.
That means the most appropriate route isn’t always to make an application based on what you think a lender might say.
It can be more sensible to start with a conversation about your circumstances and understand what options may be available.
Don’t let assumptions make the decision for you
One of the most important messages from the Lloyds research is that potential buyers are sometimes making the decision for the lender.
“I’ve got debt, so I won’t qualify.”
“My credit score isn’t good enough.”
“I’ve changed jobs.”
“I’m self-employed.”
“I don’t have a 20% deposit.”
“I’ve had problems with credit in the past.”
These circumstances may create additional considerations, but they don’t necessarily provide the complete answer.
The mortgage market is not one-size-fits-all.
Specialist mortgage advice in Windsor
At Custom Mortgage and Finance in Windsor, we work with customers whose circumstances may not fit neatly into the standard mortgage application process.
This includes helping people who have experienced previous credit challenges and may be unsure whether getting a mortgage is still realistic.
The aim isn’t to promise that everyone will be accepted. No responsible mortgage adviser can do that.
Instead, it’s about taking the time to understand the individual circumstances, explain the potential options and identify whether there may be lenders whose criteria are better suited to the situation.
For someone who has already convinced themselves that a mortgage isn’t possible, that first conversation can be an important one.
Thinking about buying your first home?
The first-time buyer market is large, active and evolving.
And while affordability remains a genuine challenge — particularly when the average first home costs more than £311,000 and the average deposit is more than £61,000 — it is worth making decisions based on your actual circumstances rather than assumptions.
If previous credit problems or another aspect of your financial history is making you think “there’s no point applying”, don’t necessarily rule yourself out before you’ve explored your options.
The first step doesn’t have to be a mortgage application. It can simply be a conversation.
If you’re in or around Windsor and would like to understand whether your circumstances could support a mortgage, speak to Toby Wheeler and Lee Devereux at Custom Mortgage and Finance.
Your home may be repossessed if you do not keep up repayments on your mortgage. Mortgage advice is subject to eligibility, affordability and lender criteria. Past credit issues do not guarantee that a mortgage will be available.
