Work out your monthly cost before you set your budget
One of the most common mistakes we see is starting with a property price and working backwards. You see a home listed at offers over £250,000, so that becomes your budget.
The better question is: what can you comfortably pay every month, once everything else is covered?
Your mortgage payment is only part of the picture. You’ll also have:
- Council tax, energy and broadband
- Home and contents insurance, plus any protection cover
- Factor fees if you’re buying a flat
- Maintenance, which comes round sooner than most people expect
- Existing commitments such as car finance, credit cards or childcare
The maximum a lender will offer you isn’t the same as your budget. It’s a ceiling, not a target.
A 5% deposit is a starting point, not the whole plan
Buying with a 5% deposit can be possible. But having the deposit saved is only one of the things a lender looks at.
At this level, lenders tend to look closely at:
- Affordability: your income against your outgoings and commitments
- Credit history: missed payments, high balances and how you use credit day to day
- The property itself: some lenders are more cautious with certain flats, new builds or non-standard construction
- Fees and costs: solicitor fees, LBTT (Scotland’s property tax, though first-time buyers may get relief) and moving costs all need to be covered too
And one point people often overlook: the cash you keep back matters. Putting every penny into the deposit can leave you with nothing for the first boiler repair or a gap between pay days.
A slightly bigger deposit can open up more lenders and better rates, but it’s not always worth delaying for. That depends on your situation, and it’s exactly the kind of trade-off worth talking through.
Contractors: don’t assume every lender sees your income the same way
If you work on contracts, you might have been told you can’t get a mortgage, or that you’ll only be offered a small one. Often that’s because one lender has looked at your income in one particular way.
Lenders don’t all assess contractors the same way. Depending on the lender, the things that can make a difference include:
- Your contract history: how long you’ve been contracting, and in the same line of work
- Your day rate: some lenders work from your day rate, others from your accounts or payslips
- Time left on your current contract, and how often you’ve renewed
- Gaps between contracts, and how you explain them
- How you’re set up: limited company, umbrella company or sole trader
The same income can lead to very different borrowing figures from different lenders. Before you apply anywhere, it’s worth knowing which lenders are likely to suit how you work.
A “no” from one lender isn’t a “no” from all of them. But repeated applications can leave marks on your credit file, so get the approach right first.
Waiting for perfect conditions can leave you stuck
In this video Marc gives three quick, honest takes. Two of them are covered elsewhere in this article. The third deserves its own space: waiting for perfect conditions can leave you stuck.
- Rent continues to go out every month
- Your circumstances change, such as a new job, a new family member or a contract ending
- Prices and rates can move in either direction, and nobody can reliably predict which
It’s natural to want to wait for rates to fall, prices to settle or your situation to be just right. Sometimes waiting is the right call. But often the “perfect moment” never quite arrives. The better approach is to make sure you’re ready, then decide based on your own situation rather than the headlines. That means knowing your budget, checking your credit file, getting your documents together and understanding what you could borrow.
Being ready gives you options. Waiting without a plan usually just gives you more waiting.
Compare the total cost, not just the rate or the monthly payment
The lowest headline rate isn’t always the cheapest mortgage. Fees, incentives, the length of the deal, the type of product and your future plans can all change the real cost.
Here’s a simple illustration. Two 2-year fixed deals, both repayment over 25 years:
| Loan size | Deal A 4.20% + £999 fee | Deal B 4.50% · no fee | Lower cost |
|---|---|---|---|
| £100,000 | £9,212 | £8,808 | Deal B · £404 |
| £200,000 | £17,424 | £17,615 | Deal A · £191 |
Interest plus fee over 24 months, assuming the fee is paid upfront, equal monthly repayments and no overpayments. Rounded to the nearest pound; savings are calculated before rounding. These are illustrative figures only — not real products or a quote. They are not total payments. Compare the same borrowing and period, including fees, incentives and the balance remaining.
Other things to compare beyond the rate:
- Incentives such as free valuations, cashback or legal fees paid
- Early repayment charges if you might move or overpay
- Overpayment allowances
- Your plans: if you might move in two years, a five-year fix could cost you
The right mortgage is the one that costs the least for the way you’ll actually use it, not the one at the top of a rate table.
to take away
Your full picture matters more than one number.
Every one of these tips comes back to the same idea: the best mortgage decision is based on your full picture, not one number. That might be the property price, the deposit, the rate or what one lender said.
That’s where an independent broker earns their keep. We look at your whole situation, compare lenders who assess it differently, and give you a straight answer, even if that answer is “wait six months and do these three things first”.
Book a conversation with Marc Supporting Edinburgh, West Lothian, Midlothian, East Lothian and across Central Scotland.