If you are asking "how much deposit do I need for a mortgage?", you will usually need at least 5% of the property's purchase price, although a 10% deposit can give you access to more mortgage options and potentially better rates. Your deposit determines your loan-to-value (LTV), which is an important factor lenders use when assessing mortgage products.
For example, a £300,000 property with a 5% deposit requires £15,000, leaving a £285,000 mortgage at 95% LTV. With a 10% deposit, you would need £30,000 and borrow £270,000 at 90% LTV.
How much deposit do I need for a mortgage in 2026?
For most residential mortgages, you should expect to need a deposit of at least 5% of the property's purchase price. A 5% deposit means you are applying for a 95% LTV mortgage.
However, there is an important distinction between the minimum deposit you may be able to use and the deposit that could give you access to a more competitive mortgage.
| Deposit | Mortgage | LTV | Example on a £300,000 home |
|---|---|---|---|
| 5% | 95% | 95% | £15,000 deposit |
| 10% | 90% | 90% | £30,000 deposit |
| 15% | 85% | 85% | £45,000 deposit |
| 20% | 80% | 80% | £60,000 deposit |
| 25% | 75% | 75% | £75,000 deposit |
| 40% | 60% | 60% | £120,000 deposit |
MoneyHelper states that buyers will usually need a deposit of between 5% and 10%, although mortgages with higher LTVs can exist. Larger deposits generally mean lower LTVs and can give borrowers access to a wider range of mortgage deals.
How much is a 5% mortgage deposit?
A 5% deposit means you contribute 5% of the property's purchase price and borrow the remaining 95%.
For example:
£300,000 property
- Deposit: £15,000
- Mortgage: £285,000
- LTV: 95%
A 5% deposit can therefore be enough to get onto the property ladder, subject to meeting a lender's affordability and eligibility criteria.
The Government's permanent Mortgage Guarantee Scheme, introduced in July 2025, is designed to support the availability of 91% to 95% LTV mortgages for eligible buyers, meaning some homebuyers can purchase with a deposit as small as 5%.
However, a 5% deposit does not automatically mean you will qualify for a mortgage. Your income, expenditure, credit history, employment circumstances, existing debts and the property itself can all affect a lender's decision.
Is a 10% deposit better for a mortgage?
A 10% deposit means you borrow 90% of the property's value, giving you a 90% LTV mortgage.
For a £300,000 property:
- Deposit: £30,000
- Mortgage: £270,000
- LTV: 90%
Increasing your deposit from 5% to 10% reduces the amount you need to borrow by £15,000 on this example.
More importantly, moving from 95% LTV to 90% LTV can potentially open up different mortgage products and pricing. Lenders generally view a lower LTV as lower lending risk, although the actual rate available will depend on the lender and your circumstances.
What is LTV on a mortgage?
LTV stands for loan-to-value. It represents the percentage of a property's value that you are borrowing through your mortgage.
The calculation is:
LTV = Mortgage amount ÷ Property value × 100
For example, if you buy a £300,000 property with a £30,000 deposit:
£270,000 ÷ £300,000 × 100 = 90% LTV
This means you own 10% of the property through your deposit and are borrowing the remaining 90% through the mortgage.
The relationship is straightforward:
Higher deposit = lower LTV
Lower deposit = higher LTV
This is one reason why saving beyond the minimum 5% can be valuable.
Why does LTV matter when applying for a mortgage?
LTV matters because it helps a lender assess the level of risk associated with the mortgage.
Generally, a lower LTV means the lender is providing a smaller loan relative to the property's value. This can result in access to a wider range of mortgage products and potentially lower interest rates.
For example:
| Deposit | LTV | General position |
|---|---|---|
| 5% | 95% | Higher LTV, fewer options may be available |
| 10% | 90% | More equity and potentially more competitive options |
| 15% | 85% | Lower borrowing relative to property value |
| 20% | 80% | Potentially wider choice |
| 25% | 75% | Lower LTV |
| 40% | 60% | Typically among the most competitive LTV bands |
MoneyHelper notes that the most competitive mortgage rates are typically associated with a 60% LTV, equivalent to a 40% deposit, although this does not mean everyone should wait until they have a 40% deposit before buying.
The right deposit is ultimately a balance between securing an affordable mortgage and retaining enough savings for the costs and financial risks associated with buying a home.
How much deposit do I need for a £200,000, £300,000 or £500,000 home?
The easiest way to calculate your deposit is to multiply the property price by the required deposit percentage.
| Property price | 5% deposit | 10% deposit | 15% deposit | 20% deposit |
|---|---|---|---|---|
| £200,000 | £10,000 | £20,000 | £30,000 | £40,000 |
| £250,000 | £12,500 | £25,000 | £37,500 | £50,000 |
| £300,000 | £15,000 | £30,000 | £45,000 | £60,000 |
| £400,000 | £20,000 | £40,000 | £60,000 | £80,000 |
| £500,000 | £25,000 | £50,000 | £75,000 | £100,000 |
These figures represent the deposit only. You should also budget for the other costs involved in purchasing a property, which can include legal fees, surveys, mortgage-related costs, moving expenses and, depending on your circumstances and location, Stamp Duty Land Tax or other property taxes.
Can I get a mortgage with only a 5% deposit?
Yes, 5% deposit mortgages are available, subject to lender criteria and your individual circumstances.
A 5% deposit produces a 95% LTV mortgage. The Government's Mortgage Guarantee Scheme supports the availability of 91% to 95% LTV mortgages for eligible buyers, although individual lenders decide which products they offer and their own lending criteria still apply.
A 5% deposit may be particularly relevant if you are a first-time buyer who has sufficient income to support the mortgage but has not yet had enough time to build a larger deposit.
The important question is therefore not simply "Can I get a mortgage with a 5% deposit?" but "Can I comfortably afford the mortgage and associated costs at the LTV available to me?"
Is it better to have a 5% or 10% deposit?
If you can comfortably save 10% without leaving yourself financially stretched, a 10% deposit can be advantageous.
The key benefits can include:
- Borrowing less money.
- Reducing your LTV from 95% to 90%.
- Potentially accessing a wider range of mortgage products.
- Potentially securing a lower interest rate.
- Reducing your monthly mortgage repayments.
- Building more equity in the property from the outset.
However, saving an additional £15,000 simply to move from a 5% to a 10% deposit on a £300,000 property is not automatically the right decision.
You also need to consider how long it will take to save the additional money, whether property prices could change during that period, your current rent and whether you need to retain an emergency fund.
Does a bigger deposit always mean a better mortgage?
Not necessarily.
A larger deposit generally reduces your LTV and can improve the mortgage options available to you, but the deposit is only one part of a mortgage application.
Lenders can also consider:
- Your income and employment.
- Your monthly expenditure.
- Existing loans and credit commitments.
- Your credit history.
- The source of your deposit.
- The property's value and condition.
- The mortgage term.
- Your age and circumstances.
- Whether you are buying alone or jointly.
- Whether you are self-employed or have variable income.
The Financial Conduct Authority (FCA) latest mortgage lending data shows that lending is influenced by several factors beyond LTV, including loan-to-income ratios. In Q2 2026, 46% of gross mortgage advances were to borrowers with high loan-to-income ratios, demonstrating why affordability and income remain important alongside the size of your deposit.
What happens if the property valuation is lower than the price I offer?
This is an important consideration when buying with a small deposit.
A lender may arrange a valuation as part of the mortgage process. If the lender's valuation indicates that the property is worth less than the agreed purchase price, the amount the lender is prepared to lend may be affected.
For example, suppose you agree to buy a property for £300,000 with a 5% deposit.
You expect:
- Deposit: £15,000
- Mortgage: £285,000
- LTV: 95%
If the lender values the property at £290,000, the lender may assess the mortgage against its valuation rather than simply the price you agreed to pay. This can create a funding gap that you may need to cover with additional cash or by renegotiating the purchase price.
This is one reason why having some savings beyond your minimum deposit can provide greater financial resilience.
Does my deposit need to be in cash?
Not necessarily. The important issue is that the lender must be satisfied with the source of the funds and the deposit must be available for the purchase.
Depending on your circumstances, a deposit may come from sources such as:
- Personal savings.
- A Lifetime ISA, where eligibility requirements are met.
- A gift from a family member.
- The proceeds from selling another property.
- Certain home ownership schemes.
If someone is gifting you money towards your deposit, the lender and solicitor will usually need evidence about the source of the funds and confirmation of whether the money is a genuine gift rather than a loan.
Can I use a Lifetime ISA for my mortgage deposit?
A Lifetime ISA can help eligible first-time buyers build their deposit.
The scheme allows eligible savers to receive a government bonus on qualifying contributions, subject to the scheme's rules and limits. The money can be used towards the purchase of a qualifying first home if the relevant conditions are met.
Because government schemes and eligibility criteria can change, buyers should check the current rules before relying on a Lifetime ISA as part of their deposit strategy.
How much should I save before applying for a mortgage?
Your target should be more than simply the minimum deposit.
A sensible mortgage budget should account for:
- Your deposit
- Legal and conveyancing costs
- Survey and valuation costs where applicable
- Mortgage fees where applicable
- Moving costs
- Property taxes where applicable
- An emergency fund
- Any immediate repairs or furnishing costs
This matters because putting every penny of your savings into the deposit can leave you with little financial buffer after completion.
The strongest mortgage position is not necessarily the person with the biggest deposit. It is the person whose deposit, borrowing level and monthly repayments are sustainable alongside the rest of their financial commitments.
What deposit should I aim for in 2026?
For many buyers, 5% is the minimum starting point, 10% is a useful target and a larger deposit can improve the range and pricing of mortgages available. Low deposit buyers should also look at first-time buyer schemes, while landlords should note that buy-to-let mortgages usually need a much larger deposit.
There is no universally correct deposit percentage because the right amount depends on your circumstances.
A useful way to think about it is:
5% deposit: Gets you into the conversation with 95% LTV mortgages.
10% deposit: Reduces your LTV to 90% and may provide access to more competitive options.
15% to 20% deposit: Reduces borrowing further and can open additional LTV bands.
40% deposit: Produces a 60% LTV mortgage, which MoneyHelper identifies as typically having some of the most competitive rates.
The best option is the one that gives you an affordable mortgage without exhausting your available savings.
Frequently Asked Questions
How much deposit do I need for a mortgage?
Most buyers should expect to need at least 5% of the property's purchase price, although the exact requirement depends on the lender and mortgage product. A 10% deposit can provide access to a wider range of mortgage options and may result in more competitive rates.
Is 5% enough for a mortgage in 2026?
A 5% deposit can be enough for some mortgages in 2026. It would normally mean borrowing at 95% LTV. However, you still need to meet the lender's affordability, credit and property criteria, and a 5% deposit does not guarantee mortgage approval.
How much deposit do I need for a £300,000 house?
For a £300,000 property, a 5% deposit is £15,000, while a 10% deposit is £30,000. A 15% deposit would be £45,000 and a 20% deposit would be £60,000. These figures do not include other costs associated with buying a property.
What does 95% LTV mean?
A 95% LTV mortgage means you are borrowing 95% of the property's value through your mortgage and providing the remaining 5% as a deposit. For example, a £285,000 mortgage on a £300,000 property represents a 95% LTV.
Is a 10% deposit better than a 5% deposit?
A 10% deposit can be advantageous because it reduces your mortgage from 95% LTV to 90% LTV. This may provide access to more mortgage products and potentially better rates. However, you should not use all your savings simply to reach a particular deposit percentage.
Does a larger deposit reduce my mortgage payments?
Generally, yes. A larger deposit means you borrow less, so your mortgage balance is lower. Your actual monthly payment will also depend on the interest rate, mortgage term and repayment method. A larger deposit may also help you access lower mortgage rates.
Can I get a mortgage with no deposit?
Some 100% LTV mortgages exist, meaning the buyer does not provide a traditional cash deposit. However, they are not widely available to everyone and can have specific eligibility requirements. You will still need money for other costs involved in buying a home.
Should I wait until I have a 10% deposit?
Not necessarily. Waiting to reach 10% could improve your mortgage options, but it may also mean spending longer saving while paying rent or facing changes in property prices and mortgage rates. A mortgage adviser can help you compare the financial implications of buying now versus waiting.
What should you do if you are ready to buy?
The answer to "how much deposit do I need for a mortgage?" is usually at least 5%, but the minimum deposit is only the starting point.
The more important question is how your deposit, LTV, borrowing capacity and monthly repayments work together. A 10% deposit may offer a better balance for some buyers, while others may be in a stronger position using a 5% deposit and retaining additional savings for emergencies and buying costs.
Before committing to a property, it is worth understanding how much you can realistically borrow and which mortgage options fit your circumstances.
Silver Oak Financial can help you understand your mortgage options, assess your borrowing position and identify a mortgage strategy that is appropriate for your circumstances. Once you own a home, life insurance can help make sure the mortgage is repaid if the worst happens. Rather than focusing solely on finding the smallest possible deposit, the aim should be to structure your mortgage in a way that is affordable, sustainable and aligned with your wider financial plans.
Silver Oak Financial can provide professional mortgage guidance to help you move from understanding your deposit requirement to making an informed mortgage decision. Book your free initial consultation when you are ready.
Frequently asked questions
Your home may be repossessed if you do not keep up repayments on your mortgage. This guide is general information, not personal advice.