How Much Deposit Do I Need for a Mortgage?

How much deposit do I need?

For most mortgage deals the minimum is 5% of the property's price. On a £280,000 home that is £14,000. Some lenders ask for 10%, and mortgages with no deposit exist but are limited and carry extra risks, such as owing more than the property is worth if prices fall.

Anything above the minimum usually makes borrowing cheaper, because the lender is taking less risk.

Deposit and loan to value

Lenders describe the deposit through the loan to value, or LTV: the part of the price that is borrowed.

| Price | Deposit | Mortgage | LTV | |---|---|---|---| | £200,000 | £10,000 (5%) | £190,000 | 95% | | £200,000 | £20,000 (10%) | £180,000 | 90% | | £200,000 | £50,000 (25%) | £150,000 | 75% | | £200,000 | £80,000 (40%) | £120,000 | 60% |

The mortgage calculator works out the LTV, the band and the extra deposit needed to reach the next one.

Interest rates tend to come in LTV bands, such as 95%, 90%, 85%, 75% and 60%. Moving down a band by raising a slightly larger deposit can change the rates available, so it can be worth checking where the thresholds fall for the deals you are looking at. Mortgages explained covers how those rates work.

Where the deposit can come from

• Savings, including a Lifetime ISA. In 2026/27 you can pay in up to £4,000 a year if you are 18 to 39, and the government adds a 25% bonus, up to £1,000 a year. A first-home purchase through a Lifetime ISA must cost no more than £450,000, and withdrawing for any other reason before age 60 incurs a 25% charge.
• Gifts from family. Lenders usually want a letter confirming the money is a gift, not a loan.
• Selling an existing home, if you are moving.
• Government and shared ownership schemes, which change over time. Check current availability.

Other upfront costs to budget for

The deposit is only part of the cash needed on completion day:

• Stamp Duty Land Tax in England and Northern Ireland. Standard rates are 0% up to £125,000, 2% from £125,001 to £250,000, 5% from £250,001 to £925,000, 10% from £925,001 to £1.5 million and 12% above. First-time buyers pay 0% up to £300,000 and 5% from £300,001 to £500,000, with no relief above £500,000. Scotland and Wales use different taxes. See Stamp Duty explained.
• Solicitor or conveyancer fees.
• Survey costs. The lender's valuation is for the lender's benefit, so many buyers pay for their own survey as well.
• Mortgage fees, such as an arrangement or valuation upgrade. MoneyHelper suggests budgeting £150 to £800 for valuations.
• Removals, furniture and an emergency fund.

Should the deposit use up all your savings?

Not necessarily the whole amount. MoneyHelper suggests keeping around three months of expenses, including the mortgage payment, as emergency savings. It also suggests thinking about income protection and life insurance, because a mortgage is a long commitment that still has to be paid if income stops.

A short deposit checklist

• What is the price range, and what does 5%, 10% and 15% come to?
• Which LTV band does the deposit fall into?
• Is any part of it a gift, and is the paperwork ready?
• Have Stamp Duty, legal and survey costs been added on top?
• How much would be left in savings afterwards?