Skip to content
    First Rung Now
    First Rung Now
    UK Mortgage Guides
    Speak to a Vetted Broker

    UK Mortgage Guide

    How Much Deposit Do First-Time Buyers Need in the UK? 2026 Guide

    The deposit is the single biggest hurdle between renters and homeowners in the UK. But the number itself — 5%, 10%, 15%, 20% — is only half the story. The <em>right</em> deposit for you depends on how much cheaper the mortgage becomes at each Loan-to-Value band, how long it would take you to save the next band, and what your rent is costing you in the meantime. This guide gives you the exact 2026 numbers so you can decide whether to buy now with 5% or wait six months for 10%.

    First Rung Now Editorial Updated 15 June 2026 7 min read

    The LTV bands that dictate your rate

    UK mortgage pricing steps up in bands. Every 5% you move down in LTV — from 95% to 90% to 85% and so on — typically unlocks a materially cheaper rate. The exact steps in 2026:

    Deposit LTV Typical 5-year fix Monthly on £200k
    5% 95% 5.10%–5.65% £1,090–£1,158
    10% 90% 4.65%–5.15% £1,035–£1,094
    15% 85% 4.45%–4.85% £1,010–£1,058
    20% 80% 4.30%–4.65% £992–£1,034
    25% 75% 4.15%–4.55% £974–£1,022
    40%+ 60% 4.05%–4.40% £962–£1,003

    The steepest saving comes from crossing 90% LTV — from that point on the pricing curve flattens. If you're at 6% deposit, pushing to 10% is worth every extra month of saving. If you're at 25%, pushing to 30% saves you very little.

    Should you buy at 5% or wait for 10%?

    Take a couple targeting a £220,000 home, currently at 5% deposit (£11,000) and paying £1,050 rent. They can save £600/month.

    • Buy now (5% deposit, 5.45% rate): Mortgage payment £1,180/month, break-even after ~10 years vs renting given rent growth.
    • Wait 18 months (build to 10% deposit £22,000, assume 4.95% rate): Mortgage payment £1,077/month. But you pay 18 × £1,050 = £18,900 in rent while waiting, and the same home is likely to have risen ~4%.

    The maths usually favours buying at 5% if the target property is likely to rise faster than 3% a year, or if rent is above 90% of what the mortgage payment would be. In flat or falling markets, waiting for 10% pays off.

    Where the deposit can come from

    Personal savings

    Money in your name, seasoned in an account for 3+ months. Show statements. Lenders occasionally ask for the source of large lump-sum credits (£3,000+) — a bonus payslip, sale of a car (V5 transfer), or ISA transfer statement satisfies this.

    Gifted deposits

    Every UK high-street lender accepts gifted deposits from immediate family. The gift-giver signs a declaration confirming: (1) it's a gift, not a loan; (2) they have no interest in the property; (3) they'll take no legal charge; (4) they can afford it. The gift usually needs to be in your account 2–4 weeks before completion. See mortgage with parental help.

    Lifetime ISA

    Under-40s can open a LISA, save up to £4,000/year, and receive a 25% government bonus (£1,000/year free). Withdraw penalty-free for first home up to £450,000. See our LISA guide.

    Help to Save

    For universal credit / working tax credit claimants. Save up to £50/month for 4 years; the government pays a 50% bonus. Maximum £1,200 bonus.

    Inheritance

    Accepted universally. You'll usually be asked for probate documentation or the executor's payment statement to evidence the source.

    Sale of assets

    Car sale, cryptocurrency (some lenders won't touch it — Halifax fine, Nationwide picky), share sale — all acceptable with evidence.

    Where the deposit cannot come from

    • Personal loans, credit cards, overdrafts — outright rejected.
    • Cash gifts without a paper trail — you must be able to show the source.
    • Undisclosed private loans from friends or family — mortgage fraud.
    • Employer loans repayable over time — some private-bank exceptions but not high-street.
    • Bridging loans as deposit for a residential purchase — very rare, and only via specialist lenders.

    How to save a deposit faster

    1. Max out both partners' LISAs: A couple can save £8,000/year and receive £2,000 in bonuses. Two years = £20,000 including bonuses.
    2. Cut the biggest three costs, not fifty small ones: Rent, car, food delivery. £150/month saved on each = £5,400/year.
    3. Move in with parents for 6–12 months: The single most effective deposit accelerator, saving £8,000–£15,000.
    4. Ask for family help early: A £10,000 gift can move you from 5% to 10% LTV, saving far more than it costs in mortgage interest.
    5. Bank pay rises and bonuses directly: Set up an auto-transfer from payroll before the money hits the current account.
    6. Sell things you don't use: Second car, unused parking space, unwanted gifts. Vinted, eBay, Facebook Marketplace.

    The invisible extras beyond the deposit

    The deposit isn't the only cash you need on completion day. Budget for these on top:

    • Legal fees: £900–£1,600 (freehold), add £250–£500 for leasehold.
    • Stamp duty: £0 as FTB under £300,000 in England/NI. Different in Scotland (LBTT) and Wales (LTT).
    • Survey: £450–£1,500 depending on level.
    • Mortgage product fee: £0–£1,499 (often added to loan).
    • Broker fee: £0–£500.
    • Removals: £300–£1,200.
    • Buildings insurance: £180–£400/year, first payment usually monthly.
    • Life/critical illness cover: £15–£60/month (not compulsory but heavily recommended).

    See our full first-time buyer costs breakdown for real numbers on £180k, £250k and £350k purchases.

    What about zero deposit?

    Genuine 100% LTV mortgages exist but they're narrow. Skipton's Track Record targets renters with 12 months' proven rental payments at or above the proposed mortgage payment. Barclays Family Springboard and Family Building Society use parental savings as security instead of a deposit. See our no deposit FTB guide.

    The bottom line

    If you can hit 10%, do. If you can hit 15%, even better — but not if it means renting for another two years. Beyond 25%, extra deposit produces diminishing returns and you're often better keeping the cash as an emergency fund or overpaying the mortgage in year one.

    Frequently asked questions