Introduction to First Direct Mortgages
When it comes to securing a mortgage, finding a lender that offers competitive rates, flexible terms, and a straightforward process is key. First Direct, a division of HSBC UK Bank plc, has carved out a reputation as a trusted, customer-focused mortgage provider in the UK.
Known for its telephone and online-only banking model, First Direct stands out by offering mortgages directly to customers, bypassing brokers to deliver personalized service and award-winning support. Whether you’re stepping onto the property ladder, climbing up it, or reshaping your finances with a remortgage, First Direct mortgages offer flexible solutions designed to fit your journey—wherever you’re headed.
In this article, we’ll dive into First Direct mortgage offers, explore their mortgage calculator, explain the mortgage in principle process, and provide a comparison table to help you make an informed decision.
Why Choose First Direct Mortgages?
First Direct has been a trailblazer in the UK banking scene since 1989, attracting over 1.5 million customers with its innovative approach to banking. Its mortgage offerings are no exception, earning accolades such as the Moneyfacts Best Bank Mortgage Provider Award in 2023. What sets First Direct apart? For starters, they don’t work with brokers, meaning you deal directly with their team, which can streamline the process and potentially save on fees.
Their mortgage range includes zero-fee options, competitive rates, and the flexibility of unlimited overpayments, allowing you to pay off your mortgage faster and reduce interest costs. Additionally, First Direct’s 24/7 customer service ensures you’re supported at every step, whether you’re applying online or over the phone.
First Direct offers two main types of mortgages: repayment mortgages and interest-only offset mortgages. Repayment mortgages are straightforward, ensuring both the interest and borrowed amount are paid off by the end of the term, provided you keep up with monthly payments. Offset mortgages, available only to existing offset customers, allow you to link savings and current accounts to your mortgage, reducing the interest you pay by offsetting your savings against the loan balance. For example, if you have a £150,000 mortgage and £30,000 in savings, you only pay interest on £120,000. This flexibility can be a game-changer for those with significant savings.
Exploring First Direct Mortgage Offers
First Direct’s mortgage offers are designed to cater to a variety of borrowers, including first-time buyers, home movers, and those looking to remortgage. Their portfolio includes fixed-rate, tracker, and standard variable rate (SVR) mortgages, each with distinct benefits. Fixed-rate mortgages provide certainty, with monthly payments remaining consistent regardless of Bank of England base rate changes. Tracker mortgages, linked to the base rate, offer flexibility but come with the risk of fluctuating payments. The SVR, set by First Direct, applies after a fixed or tracker period ends and can result in higher payments, so it’s worth planning to switch or remortgage before reverting to this rate.
Recent updates show First Direct cutting fixed-rate mortgage prices in 2025, with reductions of up to 0.30%, making their offers even more competitive. For first-time buyers, First Direct provides mortgages with as little as a 5% deposit, allowing borrowing up to 4.75 times your annual income. Their unlimited overpayment feature is particularly attractive, enabling you to reduce the loan term and interest without penalties, though early repayment charges (ERCs) may apply if the mortgage is fully paid off during a fixed-rate period.
To illustrate, consider a representative example: a £225,134 mortgage over 24 years, initially on a fixed rate of 4.88% until September 2026, followed by a variable rate of 6.99%. This would require 26 payments of £1,328.29, then 262 payments of £1,593.54, totaling £453,042, including £226,909 in interest and £999 in fees, with an overall APRC of 6.8%. This transparency helps borrowers understand the long-term costs of their mortgage.
Using the First Direct Mortgage Calculator
One of First Direct’s standout tools is its mortgage calculator, designed to help you estimate how much you can borrow and what your monthly payments might look like. By inputting details such as your income, whether you’re applying solo or jointly, and the loan-to-value (LTV) ratio, the calculator provides a rough estimate of your borrowing capacity, typically up to 4.75 times your annual income. This figure is an estimate, as affordability assessments consider factors like existing financial commitments and potential interest rate increases, ensuring you can manage repayments even if circumstances change.
The calculator also allows you to explore how overpayments or changes in interest rates could affect your mortgage. For instance, their overpayment calculator shows how regular overpayments can reduce interest and shorten the loan term. Another tool, the interest rate change calculator, helps you understand how base rate fluctuations impact tracker mortgage payments, providing clarity for budgeting. These tools are accessible on First Direct’s website and are user-friendly, making it easier to plan your home purchase or remortgage.
Understanding the First Direct Mortgage in Principle
A Mortgage in Principle (MIP), also known as an Agreement in Principle (AiP), is a critical step in the home-buying process. First Direct offers an MIP valid for six months, giving you a clear indication of how much you could borrow before you start house hunting. This document strengthens your position as a buyer, showing sellers and estate agents you’re serious and financially capable.
You can apply for an MIP online or by phone, with First Direct promising a decision on the same day for phone applications. The process involves providing basic financial details, followed by a call with a mortgage adviser to finalize the agreement and arrange a valuation.
The MIP is not a binding offer but an estimate based on your credit profile, which First Direct assesses using Experian, Equifax, and TransUnion credit reports. A strong credit score is crucial, as a less-than-perfect report could lead to a lower borrowing amount or higher interest rates. Checking your credit reports beforehand can maximize your approval chances.
Comparison Table: First Direct Mortgage Options
To help you compare First Direct’s mortgage offerings, here’s a concise table outlining key features:
| Mortgage Type | Key Features | Best For | Interest Rate Example | Fees |
|---|---|---|---|---|
| Fixed-Rate Mortgage | Stable payments, unaffected by base rate changes; unlimited overpayments allowed. | Budget-conscious borrowers seeking certainty. | 4.88% (initial, 2026) | £999 (example) |
| Tracker Mortgage | Payments vary with Bank of England base rate; flexible but less predictable. | Those comfortable with rate fluctuations. | Linked to base rate | Varies |
| Offset Mortgage | Interest calculated on loan minus savings; available to existing offset customers. | Savers looking to reduce interest costs. | Varies | Varies |
| Standard Variable Rate | Applied post-fixed/tracker period; higher rates, variable. | Temporary option before switching. | 6.99% (2025) | None (post-deal) |
Note: Rates and fees are indicative and subject to change. Always check First Direct’s website for current offers.
Tips for Applying with First Direct
Applying for a First Direct mortgage is straightforward, with options to start online or by phone. Online applications require initial details, followed by a call to confirm your MIP. Phone applications offer immediate MIP decisions, followed by a mortgage adviser consultation. To prepare, ensure your credit reports are accurate, gather financial documents, and use First Direct’s calculators to estimate affordability. Be mindful of potential ERCs if you plan to pay off your mortgage early during a fixed-rate period, and consider consulting an independent financial adviser for personalized advice.
Ready to Apply.
First Direct mortgages offer a compelling blend of competitive rates, flexible options, and user-friendly tools like their mortgage calculator and Mortgage in Principle process. Whether you’re drawn to the stability of a fixed-rate mortgage, the flexibility of a tracker, or the savings potential of an offset mortgage, First Direct has something to suit your needs. Their direct-to-customer model, award-winning service, and transparent fee structure make them a strong contender in the UK mortgage market. By leveraging their calculators and comparing options, you can confidently navigate the path to homeownership or remortgaging. Visit First Direct’s website to explore current rates and start your application today.
Is First Direct a good option for first-time buyers?
Yes, First Direct is considered an excellent choice for first-time buyers. They offer low deposit options starting from 5%, competitive fixed-rate deals, and personalized customer support, all of which can simplify the buying process.
Does First Direct charge broker fees?
No, First Direct works directly with customers and does not involve brokers, which helps save on broker-related fees and offers more direct communication.
What is the minimum deposit for a First Direct mortgage?
You can get a First Direct mortgage with as little as a 5% deposit, depending on your credit profile and income.
