First-time buyer deposit guide

The deposit is usually the biggest barrier for first-time buyers. In 2026, 95% LTV mortgages are widely available, 99% LTV deals exist at a few specialist lenders, and schemes like Deposit Unlock and shared ownership let you buy with less than 5% down. The right deposit isn't "as much as possible", it's the amount that gets you the rate and lender you actually want.

Here's how to think about deposit size, deposit sources, and the schemes available for lower-deposit buyers.

How much deposit do you really need?

The quick answer: at least 5% of the property value, ideally 10-15% for meaningfully better rates. Headline thresholds in the 2026 market:

• 5% deposit (95% LTV): Widely available from mainstream lenders. Rates typically 0.3-0.6% higher than 90% LTV. You pay more every month but you're in the door.
• 10% deposit (90% LTV): Meaningful rate drop vs 95% LTV. Best balance of accessibility and pricing for most FTBs.
• 15% deposit (85% LTV): Another rate drop. Worth aiming for if you have time.
• 25%+ deposit (75% LTV or less): The most competitive rates in the market. For most FTBs this is out of reach; for those with family help or long savings history it's worth targeting.
• Less than 5%: Possible via specific schemes, Deposit Unlock (new build), Skipton Track Record 100% mortgage for renters, shared ownership, or the 99% LTV mortgages offered by a very small handful of lenders.

The right amount of deposit isn't the maximum you can raise, it's the amount that opens up the lender pool and rate band you want, without draining your liquidity so much that you can't cope with moving costs and an emergency fund.

Lenders have specific rules

Your own savings

Straightforward. Lenders want to see the savings sitting in your account with a paper trail (ideally 6+ months of statements showing growth). Large unexplained deposits raise anti-money-laundering questions that delay applications.

Gifted deposit from family

Very common. Lenders accept gifts from parents, grandparents, siblings (with specific rules). The giver signs a gift letter confirming it's a non-refundable, non-interest-bearing gift with no claim on the property. Gifts from non-relatives are much harder to place.

Loaned deposit

Most lenders don't allow loans for deposit, they would affect affordability. A minority of specialist lenders accept family loans under specific structures. Not straightforward, discuss with us.

Inheritance

Treated as savings. Lenders want evidence of the inheritance (solicitor's letter or probate) and that it's now sitting in your account.

Sale of other assets

Previous property, shares, crypto, car, all acceptable with evidence of the sale and where the money came from. Bitcoin and crypto need particular care; some lenders still don't accept them directly, usually need to be converted to GBP first.

Equity from existing property

Second-time buyer rather than first-time buyer, but for completeness: equity from a previous sale (net of any mortgage redemption) is the most common deposit source for home movers.

Lifetime ISA (LISA)

Up to £4,000/year into LISA plus 25% government bonus = up to £5,000/year free money. Must be used for first home purchase under £450k (England). Highly recommended for aspiring FTBs under 40.

Help from family, beyond gifts

Joint borrower sole proprietor (JBSP) mortgages let family members join your application (and accept liability) without being on the property title. Family offset mortgages let family savings support your mortgage without actually being gifted. Alternatives worth knowing about.