How to Get a Mortgage with a 5% Deposit

Getting a mortgage with a 5% deposit is one of the most achievable ways to buy a home — especially for first-time buyers or those returning to the property market after renting.

The good news? While 5% deposit mortgages are becoming increasingly common, there are now some options with even lower deposit levels — starting from 2.5%, or even 0% through certain Shared Ownership schemes (subject to eligibility and housing association approval).

At Mortgage Bridge, we help clients across the UK find competitive low deposit mortgages — whether you’re buying for the first time, remortgaging, or navigating complex income or credit situations.

Here’s what you need to know about how 5% deposit mortgages work, how to qualify, and what options you might have depending on your circumstances.

What Is a 5% Deposit Mortgage?

A 5% deposit mortgage means you’ll contribute 5% of the property’s price upfront, and your lender will provide the remaining 95% through a mortgage loan — known as a 95% loan-to-value (LTV) mortgage.

For example:

On a £200,000 property, your deposit would be £10,000.
Your mortgage would cover the remaining £190,000.

These mortgages are popular because they allow you to get on the property ladder faster — without needing to save tens of thousands more.

Who Can Get a 5% Deposit Mortgage?

5% deposit mortgages are designed primarily for first-time buyers, but can also suit:

Home movers with limited equity.
Applicants with stable income but low savings.
Those with minor credit issues who meet affordability checks.

Lenders usually assess your application based on your income, outgoings, and credit history — not just your deposit size.

💡 If you’ve been paying rent on time each month, some lenders may count your rental payment record as proof of affordability.

What Types of 5% Deposit Mortgages Are Available?

There are several ways to access a mortgage with a 5% deposit, depending on your situation.

1. Standard Residential Mortgages

Many high-street and specialist lenders now offer 95% LTV deals.

Available for most property types.
Suitable for applicants with steady employment or self-employment history.
Fixed and variable rate options available.

💡 You may qualify for a better rate if your credit history is clean and your debt-to-income ratio is low.

2. Government-Backed Mortgage Guarantee Scheme

The Mortgage Guarantee Scheme was introduced to encourage lenders to offer 5% deposit products by reducing their risk.

Available for homes up to £600,000.
You don’t need to be a first-time buyer.
Works with standard repayment mortgages only.

💡 Some lenders still use this scheme today, supporting those with small deposits and solid affordability.

3. Shared Ownership Mortgages (Including 0% Deposit Options)

If you can’t quite reach a 5% deposit, Shared Ownership might help.

You buy a share (typically 25–75%) and pay rent on the rest.
Some housing associations now accept 0% deposits — but you’ll need to confirm eligibility with them directly.
Ideal for those with stable income but limited savings.

💡 Mortgage Bridge can identify housing associations currently offering no-deposit Shared Ownership options.

4. Specialist Low Deposit Lenders (from 2.5%)

Some lenders now go below the traditional 5% level — offering mortgages from 2.5% deposit for applicants who meet specific affordability or credit criteria.

Great for borrowers with strong affordability but minimal savings.
Available for both employed and self-employed applicants.
May include slightly higher interest rates due to higher LTV.

💡 We regularly help clients secure 2.5% deposit deals — particularly those with good payment conduct or stable long-term employment.

Can You Get a 5% Deposit Mortgage with Bad Credit?

Yes, it’s possible — though your lender choice may be more limited. Specialist lenders are more flexible than high-street banks and will look at your overall profile, including your employment, income, and how long ago credit issues occurred.

Here’s a rough guide:

Credit Situation	Typical Minimum Deposit
Clean credit history	5%
Minor credit blips (over 2 years old)	5–10%
Recent defaults, CCJs, or arrears	10–25%

💡 Even with bad credit, being employed in a stable job or essential role (like NHS or education) can improve your mortgage prospects.

How to Strengthen Your Application

Even if you only have a 5% deposit, there are several ways to make your application stand out.

1. Check Your Credit File Thoroughly

Before applying, review your full credit report using Checkmyfile (which pulls data from Experian, Equifax, TransUnion, and Crediva).

Make sure all debts and addresses are up to date.
Close unused credit accounts.
Correct any errors before you apply.

💡 A small score improvement can make a big difference to your interest rate options.

2. Show Consistent Income and Employment

Lenders like to see steady employment or at least 12 months of self-employed trading history.

Provide your latest three payslips and P60.
For self-employed applicants, provide tax returns and bank statements.
Avoid big spending or credit applications before your mortgage assessment.

3. Use a Mortgage Broker Who Understands Low Deposit Lending

Not all lenders advertise their low deposit deals — many are available only through brokers.

At Mortgage Bridge, we work directly with lenders offering:

95% LTV mortgages for first-time buyers.
2.5% deposit options for strong affordability profiles.
Shared Ownership and no-deposit deals.

💡 We’ll compare the market to find your best fit and handle the entire application process for you.

Real Example: 5% Deposit Approved

A client approached us after being declined by a high-street bank due to variable income and a small 5% deposit.
By assessing her full earnings (including overtime) and using a flexible lender, we secured a 95% LTV mortgage — helping her buy her first home sooner than expected.

💡 Even a small deposit can go a long way with the right approach.

How Mortgage Bridge Can Help

At Mortgage Bridge, we specialise in helping clients secure low deposit mortgages, even when the odds feel stacked against them.

We’ll:

Review your affordability and credit profile.
Match you with lenders offering 5%, 2.5%, or 0% deposit deals.
Support you through every step — from application to completion.

💡 Whether you’re a first-time buyer or moving home, our goal is to help you buy with confidence — even with a smaller deposit.

Let’s explore your options together.

How to Get a Mortgage with a 5% Deposit | Expert Guide from Mortgage Bridge