Mortgage deposit explained
Last reviewed 28 June 2026 · Smarter Mortgage Quotes editorial team
Your deposit isn’t just the entry ticket — it controls which lenders will lend to you and the rate they’ll offer. Each 5–10% of LTV typically opens a fresh band of cheaper rates.
Minimums
5% is the practical minimum at most UK lenders (95% LTV), via the Mortgage Guarantee Scheme or own-brand 95% LTV products. 10% (90% LTV) opens far more options. 25% (75% LTV) usually unlocks the best high-street rates.
LTV bands that matter
- 95% LTV — entry tier, fewer lenders, higher rates.
- 90% LTV — significantly more competitive.
- 85% LTV — wide lender choice.
- 75% LTV — typically the best “mainstream” rates.
- 60% LTV — the very best rate tier.
Gifted deposits
Most lenders accept gifts from immediate family with a signed gift letter confirming the funds are non-refundable and the gifter has no interest in the property. A few accept gifts from extended family or friends.
Lifetime ISAs and First Homes
The LISA gives a 25% government bonus on up to £4,000/year for first-time buyers (up to £450,000 property price). The First Homes scheme offers 30–50% discount on selected new builds in England.
Not sure how much deposit you need? Check your borrowing power or speak to an adviser about your deposit options.