Arranging a mortgage in London may require a different approach than buying elsewhere in the UK. Here, we’ll explain what makes London mortgages unique, what options may be available to you, and how working with a knowledgeable London mortgage broker can help you secure the best deal.
What to consider when getting a London mortgage
Buying or remortgaging in London comes with challenges that don’t always apply elsewhere in the country. Higher property prices, a more complex housing market, and localised schemes mean that choosing the right lender and mortgage structure matters far more than simply finding the lowest headline rate.
Higher property prices and stricter affordability
London’s property prices are significantly higher than the national average, which directly impacts how lenders assess affordability. Even with a substantial salary, you might find it difficult to borrow the amount you need.
Buyers tend to hit affordability ceilings sooner in London than they would elsewhere, especially if applying alone or relying on a single household income. Because of this, choosing lenders with more generous income multiples or flexible affordability models for Londoners can make a massive difference.
Property types unique to London
London has a higher proportion of property types that mainstream lenders approach with caution. This includes properties such as ex-local authority flats, high-rise buildings, flats with cladding, short leases, and properties with high service charges.
Some lenders will restrict lending on these properties altogether, while others apply tighter loan-to-value (LTV) limits or require additional checks. This makes it essential to match the property to the right lender early, rather than assuming every high street bank will lend on every London flat or house.
Borough-specific schemes and incentives
Certain London boroughs operate their own housing initiatives, including shared ownership allocations, first-time buyer priority on new build developments, or discounted market sale schemes.
While these can help you get on the property ladder sooner, they often come with strict eligibility criteria, resale restrictions, or lender limitations. Understanding how these schemes interact with mainstream mortgages is crucial.
Importance of local mortgage knowledge
London's housing market is complex and operates as its own unique borrowing ecosystem, so your approach may need to vary by postcode. Some lenders are more comfortable in specific areas or boroughs, while others may choose to avoid certain developments or locations.
A broker with local London or borough-level experience can anticipate these issues and direct your application to lenders who are already comfortable with similar properties and areas. This kind of local knowledge can save you time, reduce the risk of rejection, and help you secure the best mortgage for your long-term plans.
What is the average mortgage repayment in London?
According to data released from the ONS and the Bank of England’s UK House Price Index, the average price of a terraced house in London was £594,000. They calculated that based on a 75% LTV with a 5-year fixed mortgage over 25 years, the average London mortgage repayment for a terraced house was £2,616.
However, in reality, there isn’t a single “average” London mortgage repayment amount that works for the whole of London, simply because there is so much variation in terms of property types, prices, and a constantly fluctuating interest rate environment.
Do all lenders offer mortgages there?
Most mainstream mortgage lenders operate in London, but that doesn’t mean they’ll lend on every London property. You may find that you need to approach a specific lender because some London mortgage lenders may restrict lending on:
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Ex-local authority flats in certain boroughs
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High-rise blocks over a set number of storeys
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Properties with complex cladding or fire-safety issues
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Flats with unusually high service charges
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Properties of non-standard construction
Other lenders may cap how much people can borrow or apply stricter criteria to higher-value borrowing. As a result, the “best” London mortgage lender on paper may not be the right lender for your specific property. This is why lender selection in London is often more important than chasing headline rates.
Mortgage schemes available in London
London home buyers may be eligible for a range of London-specific mortgage and homeownership schemes designed to reduce deposit requirements or improve affordability. These can include:
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London Living Rent: Part of Homes for Londoners, this involves homes rented on 3-year minimum tenancies at below-market rent, with the option to buy the house on a shared ownership basis during the tenancy.
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Shared ownership schemes: Particularly helpful for first-time buyers struggling to save a deposit or borrow enough to cover a full property purchase.
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The First Homes Scheme: Offering discounted new-build properties (of at least 30%) in selected London areas, provided you meet the criteria.
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95% LTV mortgages: Allowing property purchases with a 5% deposit.
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Family-assisted or guarantor mortgages: Helping you boost how much you can borrow with outside support.
Each scheme has eligibility criteria that vary by borough and lender. A broker can explain which schemes are realistic and how they affect long-term affordability.
How to choose the best London mortgage broker
When you’re buying in London, choosing the right mortgage broker is often as important as choosing the right property. An experienced London broker will have a deep understanding of all the lenders operating in the area, including the major names and the smaller, niche lenders.
A practical understanding of local lending behaviour throughout London means they’ll know which lenders prefer certain boroughs, which are cautious about ex-council flats, and which are more comfortable with applicants who have complex income or credit.
At Money Helpdesk, we can arrange local advice and introduce you to advisers who specialise in specific areas, including East London, South London, North London, West London, and Central London. This ensures you’re speaking to someone who understands the realities of your postcode, not just generic nationwide lending rules.
Get bespoke London mortgage advice today
Mortgages for first-time buyers in London
First-time buyers in London often face the dual challenge of saving a significant deposit while dealing with high rental costs. So, it’s worth leaning on every possible resource and use every tool at your disposal, which may include:
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Exploring 5% deposit mortgages (95% LTV)
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Shared ownership to reduce initial hurdles
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Gifted deposits from family members
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Taking advantage of any local London schemes or supports
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Longer mortgage terms to reduce monthly payments
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Accessing higher income multiples where possible
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Ensuring all your income (including self-employed income is factored into the affordability calculations)
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Using a Lifetime ISA (LISA) to boost your deposit
Because some lenders apply stricter affordability models in London, working with a broker early can help first-time buyers understand precisely what’s realistically available and explain how to maximise how much you can afford to borrow.
Buy-to-let mortgages in London
The London rental market remains an attractive option for landlords, but buy-to-let (BTL) lending has become more complex. When arranging a buy-to-let mortgage in London, lenders typically assess:
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Projected rental income relative to mortgage payments
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Stress-tested interest rate implications
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Property type and specific local London demand
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Whether you’re a first-time landlord or have past experience
A specialist buy-to-let London mortgage broker can help prospective landlords identify BTL lenders that apply more practical assessments and offer competitive rates to ensure your ability to maximise your London property investment.
How Money Helpdesk can help you get a mortgage in London
With so many options available, finding the right support when buying a home in London can feel overwhelming. To help you reach your property ownership goals faster, we work with specialist mortgage brokers who focus exclusively on London lending.
Here’s why home buyers throughout the capital choose us to help them arrange the best London mortgage:
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Free initial chat with an independent London mortgage broker
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Compare exclusive rates and deals for London properties
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Access to advisers with borough-specific knowledge
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Expert support for residential, buy-to-let, and commercial mortgages in London
If you’d like to start comparing London mortgages today, or speak with a broker with expert, local London knowledge, you can get started here.
FAQs
Mortgage rates themselves are not usually location-based. However, London borrowers can often access different products due to higher loan sizes, property types, or specialist criteria, which can impact the rates available to you.