How much deposit do you need for a house?

Most lenders will require a deposit of at least 5% of the property’s purchase price. Meaning for a property priced at £300,000 you’d need at least a £15,000 mortgage deposit.

Though you’ll typically find better mortgage rates and more options with larger deposits of 10%, 15%, or 20%.

A house deposit (or mortgage deposit) is the amount of money you pay upfront towards purchasing a home. It’s your initial contribution towards the purchase price, with the remainder covered by your mortgage.

Your deposit funds can come from various places, including personal savings, a gift from family or friends, inheritance, or the sale of a previous property.

Your deposit impacts both your mortgage options and the interest rate you’ll pay. Lenders view larger deposits as lower risk, which translates to better deals for you.

With a smaller deposit, you’ll typically face higher interest rates and fewer lender choices.

The larger deposit you can put down the easier you’re going to make life in the long-term:

• Better mortgage rates: The larger your deposit, the lower your loan to value (LTV) will be. Your LTV is simply the amount you owe divided by what your home is worth. Lower LTV ratios typically qualify for better interest rates.
• Lower monthly repayments: The less you borrow, the cheaper your monthly repayments are going to be. Saving for a bigger deposit can save you thousands a year in monthly repayments.
• More lender choice: A bigger deposit means you’re more attractive to lenders. You’ll have access to a wider range of mortgage lenders and products, giving you more negotiating power and better terms.
• Higher chance of being accepted: Lenders view larger deposits as lower risk, making you a more attractive borrower increasing your chances of mortgage approval.

The minimum deposit you need for a house is typically 5% of the property’s purchase price. This means you can borrow up to 95% of the home’s value through your mortgage, making homeownership accessible even if you haven’t saved a huge deposit.

While 95% mortgages (requiring just a 5% deposit) are available from most major UK lenders, they're not always easy to secure. You’ll need to have a steady household income and good credit scores to be accepted for these high loan-to-value mortgages.

On a £200,000 property, a 5% deposit would be £10,000, allowing you to borrow £190,000. However, remember that with such a small deposit, you'll face higher interest rates and stricter lending criteria. You'll also need to budget for additional costs like stamp duty, legal fees, and moving expenses on top of your minimum deposit.