How Much Deposit Do First-Time Buyers Typically Need?
First time buyer deposit requirements vary depending on the lender, your credit profile, and whether you’re using a government-backed scheme. While deposits can start from as little as 5%, many first-time buyers aim for 10% or 15% to access better rates and stronger affordability checks.
In this guide, we explain how much deposit you really need, how lenders assess first-time buyer applications, and what options are available if saving feels challenging.
We’re here to help if you’d like to talk through your situation.
What Is the Minimum Deposit for First-Time Buyers?
The typical minimum deposit is:
- 5% deposit (95% LTV) – the lowest standard option
- 10% deposit (90% LTV) – easier approvals and better rates
- 15% deposit (85% LTV) – much wider lender choice and stronger pricing
While 5% is possible, higher deposits often benefit first-time buyers in every part of the mortgage process — from affordability to the interest rate offered.
Why a Bigger Deposit Helps First-Time Buyers
A larger deposit means:
- Lower monthly mortgage payments
- Cheaper interest rates
- More lender options
- Reduced income requirements
- Better protection against rate rises
For many buyers, the step from 5% to 10% makes a noticeable difference, and the jump to 15% often opens up the most competitive pricing in the market.
What Deposit Do You Need Based on Property Price?
Here are quick examples to show how different deposit levels translate into real numbers:
Property price: £200,000
- 5% deposit → £10,000
- 10% deposit → £20,000
- 15% deposit → £30,000
Property price: £300,000
- 5% deposit → £15,000
- 10% deposit → £30,000
- 15% deposit → £45,000
These numbers help you understand how much you may need to save depending on the area you’re buying in.
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How Credit History Affects the Deposit You Need
Lenders adjust deposit requirements depending on your credit record:
Clean credit
- 5%–10% deposit usually acceptable.
Minor missed payments or older issues
- 10% may be required.
Defaults or CCJs
- 10–15% deposit is typical.
More recent or severe issues
- 15–25% may be required, depending on circumstances.
We explain this in more depth in our guide on adverse-credit mortgages.
How Your Income Affects Your Deposit Options
Your income doesn’t change the minimum deposit, but it does affect:
- How much you can borrow
- Whether you can meet lender affordability
- Which products you qualify for
If your income is lower relative to the property price, a larger deposit reduces the loan amount and may help you pass affordability checks more easily.
Some lenders also offer enhanced income multiples for:
- Higher-earning professionals
- Applicants with strong credit
- Those with larger deposits
If you’d like us to calculate your borrowing power, we’re happy to help.
Do First-Time Buyers Need a Bigger Deposit for New Builds?
Yes — often they do.
New-build houses and flats sometimes require:
- 10%+ deposit
- 15% for some lenders
- 20% for certain new-build flats
This is because new builds can fluctuate in value shortly after completion, so lenders treat them differently for risk purposes.
If you’re buying a new build, planning for a slightly larger deposit is wise.
Does Property Type Affect Deposit Size?
Yes — lenders adjust requirements based on the property’s perceived risk.
Typical examples:
Standard houses
- 5–10% deposit options available.
Flats
- Often require 10%, especially for first-time buyers.
- 10–15% depending on the block.
- Smaller deposits required because you only mortgage the share you’re buying.
Non-standard construction
- May require larger deposits or specialist lenders.
We can check which lenders support your chosen property type.
Deposit Options for First-Time Buyers Using Schemes
Different schemes can reduce the deposit you need. Examples include:
- Deposits can start from 5% of the share, not the full property value.
Example:
Full price £300,000, buying 40% share (£120,000)
5% deposit → £6,000
This significantly reduces upfront savings.
Family springboard mortgages
No deposit needed if a family member deposits 10% of the property price into a linked savings account.
We explain this fully in our guide on family springboard mortgages.
Joint borrower, sole proprietor mortgages
Allow a family member’s income to support affordability — but a deposit still applies. This doesn’t reduce the minimum deposit but can make borrowing easier.
Gifted deposit
Acceptable with many lenders, especially from parents or close family.
If you’re unsure which route suits you, we can explore your options together.
Can First-Time Buyers Use a Loan for Their Deposit?
In almost all cases:
- Personal loans cannot be used as a deposit
- Credit card borrowing cannot be used
- Unsecured borrowing before application may weaken affordability
Acceptable deposit sources generally include:
- Savings
- Investments
- Inheritance
- Gifts
- Sale of personal assets
- Family springboard funds
- Equity from another property (rare for first-time buyers)
If in doubt, we can check whether your deposit source is accepted.
Do First-Time Buyers Pay Higher Rates with a Smaller Deposit?
Yes — rates are usually highest at 95% LTV and decrease gradually as your deposit grows.
Typical pattern:
- 95% LTV → most expensive
- 90% LTV → more choice
- 85% LTV → competitive
- 80% LTV → stronger pricing
- 75% LTV → best pricing in many cases
Even increasing your deposit by just 5% can make a meaningful difference to your rate.
Should You Wait to Save a Bigger Deposit?
It depends.
Reasons to buy sooner:
- Rising rents may be higher than mortgage payments
- Property prices may increase faster than your savings
- A stable income and clean credit may qualify you now
Reasons to wait:
- Your deposit is very close to moving from 5% to 10%
- You want access to significantly better rates
- You need time to improve your credit profile
We can help model both scenarios so you can make an informed decision.
How to Build a Deposit Faster
Here are practical ways first-time buyers often accelerate their deposit savings:
- Set up a separate savings pot
- Automate transfers each payday
- Cut unused subscriptions
- Use savings accounts with bonus interest
- Track spending using budgeting apps
- Consider Shared Ownership to reduce the deposit required
Small steps add up quickly and help the process feel more manageable.
Frequently Asked Questions
What is the minimum deposit for first-time buyers?
Typically 5%, but 10–15% offers better rates and more lender choice.
Do lenders prefer a 10% deposit?
Yes — many lenders price 90% LTV products more favourably.
Can I buy with no deposit?
Only through specialist routes such as family springboard mortgages.
Are deposits different for flats?
Often yes — many flats require 10% or more.
Does bad credit affect the deposit needed?
Usually — expect 10–25% depending on severity.
Final Thoughts
Understanding how much deposit first-time buyers typically need helps you plan realistically and avoid surprises. While 5% deposits are available, many buyers find that 10% or 15% unlocks better rates, more lending options, and smoother approvals.
We’ll help you work out the best deposit level for your circumstances and guide you through the options available, step by step.
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