3-step plan for getting onto the housing ladder

This article is brought to you by our partner Loqbox. They are a financial wellness company dedicated to helping people improve their credit profile through dedicated credit-building tools and education.

Many recent arrivals look at how to get onto the UK’s property ladder after starting off in rental accommodation. And unless you’re buying with cash (lucky you!), you’re likely to need to get a mortgage for your first home purchase. Although it may be possible to get 100% mortgages, it’s far better to seek mortgages where you’re able to put down an adequate deposit.

Most homebuyers will seek either a high-interest cash savings account to accumulate their deposit funds or a specialist savings account, such as a Lifetime Individual Savings Account (LISA) if eligible.

Start saving now

If you’re worried you don’t have enough in your savings, you’re not alone. In fact, 2 in 5 Brits have £1,000 or less in their savings, and 1 in 6 UK adults have no savings at all.

The most important thing with building a good savings habit is to start small, keep consistent, and ideally ringfence your regular savings each month on payday so you don’t spend it.

When Loqbox surveyed members in 2025, the most common “biggest money regret” was “spending on things I didn’t need” - cited by 33% of respondents. This new year, we’d urge you to spend wisely and save wisely to build good financial habits before you start to apply for mortgages.

As the homebuying process can be quite lengthy and stressful, we’ve come up with a 3-step plan to help you prepare your finances for this big decision.

3-steps to buying a house in the UK

Step 1: Building foundations

To access many financial products in the UK (from mortgages to mobile phone contracts), lenders check your credit file. It’s a record of your personal credit history used to check creditworthiness.

For recent arrivals, this can be challenging. Your credit history doesn’t transfer internationally, which leaves you with a thin credit file or starting from scratch.

How to get started with your credit-building journey:

• Check your credit file for free by visiting Credit Karma. Each agency uses different scoring systems, so look at the overall picture
• Loqbox membership can help improve your score. On average, our members see a 200-point improvement in a year, and 94% feel better about money after just six months.*
• There’s no magic wand, but healthy habits you build with Loqbox can support meaningful progress
• Loqbox Rent allows full members to report rent payments to Experian, which adds depth to your credit file so your rent finally counts.

Step 2 - Credit-sensible

When you can access credit, use these tips to borrow safely:

1. Only borrow if you really need to. With the average UK adult in a little over £4k of unsecured debt think carefully before borrowing again.
2. Start small. Credit cards can be helpful just make sure you pay them off in full each month to avoid interest.
3. Aim for low utilisation. Try to keep spending under 25% of your credit limit. CRAs look at your total utilisation across all channels.
4. Diversify carefully. Different credit types (like a credit card, a mobile phone contract, or a revolving line of credit) demonstrate responsible borrowing if you stay within your means.

Step 3 - Mortgage-readiness

After a few months of reporting rent, using credit responsibly and building savings, the six months before you apply for a mortgage are crucial.

Here are the key areas lenders assess:

Proof of income: Lenders sometimes ask for up to six months of payslips, a P60 and an employer letter, evidence that confirms your role, salary and length of service.

Proof of address history: Lenders verify the last five years using utilities, bank statements, council tax bills, and/or electoral roll registration

The previous three months of bank statements: Lenders are looking for:

• Affordability
• Responsible spending
• Account management
• Consistency in your income and spending

Proof of deposit: Lenders must verify where your deposit has come from, so you comply with the Anti-Money Laundering (AML) regulations.

• Savings: Show gradual accumulation
• Gifted deposit: You need a signed letter and AML checks on the donor
• Sale of asset: Provide supporting documentation of the sale

If you prepare them in advance, it’ll demonstrate your reliability. Win!

3-6 months before you apply for an AIP (Agreement in Principle)

Keep your credit stable: Avoid applying for new credit as hard searches signal risk. Side-step new personal loans, credit cards, car finance and even Buy Now Pay Later.

Limit big financial moves: Avoid major non-essential spending and keep your budget steady.

Check your financial health

• Fix errors on your credit file
• Ensure accounts show on-time payments
• Register to vote and/or request identity confirmation
• Check that Loqbox Rent entries appear correctly

On application day:

• Ask your lender or broker for an informal pre-check before the AIP, and;
• Whether they’ll run a soft or hard search

If something goes wrong, just remember that a rejection isn’t the end. Avoid reapplying immediately; take time to review the lender’s feedback and your credit file, then reapply once the issues are resolved.

For more credit-building tips, visit Loqbox.com.

*Based on a representative survey of 700 Loqbox members conducted in September 2025.