You might be able to buy a home, even if it feels out of reach. You’re not alone if you think high house prices, deposits and the cost-of-living mean buying a home is off the table. This guide walks through the low deposit and no deposit mortgages available now, the government schemes designed to help, and the ways your family or a partner can boost your buying power. It will also cover steps to strengthen your mortgage application, plus answers to the questions we hear most from people who feel priced out, so you can see exactly what's realistic for you.
"Honestly, one of my favourite parts of the job is telling someone they can buy sooner than they thought. So many people come to us convinced they need a huge deposit or a perfect credit score, when there are so many ways to make mortgages more reachable. Don't rule yourself out before you've even had the conversation.”
Rachel Geddes
Strategic Lender Relationship Director
Why buying a home can feel out of reach
Owning your own home could be easier than you think. There are loads of different mortgage options out there, even for buyers with a low deposit or blips on their credit history.
Whether you're wondering how to buy a home on a low income or just looking for a bit of first time buyer help, you've probably got more ways to get on the property ladder than you realise.
Barriers to buying a home – and how to overcome them
Most people that feel a bit stuck come up against one of three things:
Deposit. Saving while renting is tough. Rent takes a big chunk of your income, and the idea of saving thousands on top can feel impossible.
Affordability. Lenders need to see that what you earn can comfortably cover the mortgage payments. If your salary feels stretched already, you might worry that you won’t pass the checks.
Credit. A less than perfect credit history can make you feel like you’ve already failed before you start.
These might be barriers, but they’re not brick walls. There are mortgages and schemes designed for people in these situations.
Common myths about what you need to buy
A few myths keep people renting for longer than they need to. Does any of this sound familiar…
You need a 20% deposit
A spotless credit score is essential
Being debt-free is a must
Self-employed people can't get a mortgage
You need to buy with someone else to make it affordable
The Bank of Mum and Dad has to help
None of these are true. A quick conversation with one of our advisers will give you clearer answers than hours of doom scrolling forums or comparison sites, because an adviser is looking at your actual situation, not a generic example.
How much do you actually need to buy?
The amount you need to buy a home is usually smaller than people assume, especially with the mortgages and schemes available now.
Minimum deposit and realistic property prices
Most lenders ask for at least 5% of the property price as a deposit. On a £300,000 home, that's £15,000.
You could save that in three years by putting the maximum (£4,000) in a Lifetime ISA each year and benefitting from the 25% government bonus.
A few lenders offer 100% mortgages, which means no deposit at all. Zero, nothing. These are usually based on your rental track record rather than savings.
If you're looking at property prices and thinking even 5% feels huge, remember:
You don't need to buy your forever home first
Flats and smaller homes often cost far less
Schemes like Shared Ownership really reduce the upfront cost
Other parts of the country might be cheaper than where you're looking now
How lenders work out what you can borrow
Lenders look at:
Your income
Your regular spending
Any existing debts
How steady your finances look month to month
They use this to work out a comfortable loan amount. Don’t worry, spending on holidays and going out isn’t banned! But it’s important you can afford your lifestyle and your mortgage.
Use our Mortgage Repayment Calculator to find out how much your mortgage payments are likely to be based on interest rates and terms
Upfront costs beyond the deposit
Your deposit isn't the only cost you'll need to budget for. You'll also want to set aside money for:
Stamp duty
Solicitor's fees
A survey
Mortgage arrangement fees
Moving costs
The good news is there are a few ways to soften these upfront costs:
First time buyers get stamp duty relief, which takes a big chunk off the bill straight away.
Mortgage arrangement fees can usually be added to your loan, so you don’t have to cover them upfront.
Many solicitors offer no sale no fee deals, which means you’re protected if your purchase falls through.
All small wins, but they make the early costs feel much more manageable.
Low-deposit mortgage options
A small deposit doesn't have to put your home-buying plans on hold. There are several mortgage options that could help you get moving sooner.
95% mortgage and 5% deposit
A 5% deposit can be enough to buy a home, with a lender covering the remaining 95%. These are among the most common low deposit mortgages, and they're particularly popular with first time buyers.
The government's Mortgage Guarantee Scheme, sometimes called Freedom to Buy, helps support some 95% mortgages by giving lenders extra protection. There's no need to apply for this backing yourself.
Rates can be a little higher than on mortgages with bigger deposits, but a 5% deposit can make buying a home possible without years of saving first.
No-deposit and 100% mortgages
A handful of lenders offer 100% mortgages, so no deposit is needed at all. These can be brilliant for people who can comfortably afford the monthly mortgage payments, but have struggled to save a deposit while paying high rent.
These mortgages often look at your rental payment history instead.
What are the risks of low deposit mortgages?
The main thing to weigh up with a low deposit mortgage is the risk of negative equity. This is when your mortgage is bigger than the value of your home. It can happen if house prices fall.
Negative equity might sound scary, but it doesn't mean you'll lose your home or that your mortgage payments will go up. It can make moving a little trickier, but you'll probably stay in your first home for a few years anyway.
A mortgage adviser can talk through the pros and cons with you and help work out whether a low or no deposit mortgage fits your circumstances.
Schemes that can help you buy
If a low or no deposit mortgage isn't quite right for you, there are a few government schemes might be a better fit. These schemes change fairly often. An adviser will always have the latest picture, and can tell you quickly whether you'd qualify for any of them.
Shared Ownership
You buy a share of your home, usually between 10% and 75%, and pay rent on the rest to a housing association. You only need a deposit for the share you're buying, which makes this an easier starting point for a lot of buyers.
First Homes scheme
New build homes at a discount of at least 30% off market value, aimed at local first time buyers and key workers. Availability varies by area, so it's worth checking what's near you.
Lifetime ISA
Save towards your deposit and the government adds a 25% bonus on top, up to £1,000 a year. It's free cash from the government, and honestly, a bit of a no-brainer if you're eligible.
Right to Buy
If you're a council tenant, you may be able to buy your home at a discount. The longer you've been a tenant, the bigger the discount tends to be.
Buying with help from family
If your family are able and willing to help, there are a few ways they can boost your buying power.
Gifted deposits
This is money towards your deposit, usually from parents or close family, that they don’t expect back. Your lender will usually ask for a short letter confirming it's a genuine gift, not a loan.
Guarantor mortgages
A family member agrees to cover your mortgage payments if you can't keep up with them. This extra reassurance can help you qualify when your income or credit history means you don't quite meet a lender's usual criteria.
Joint borrower sole proprietor (JBSP) mortgages
A parent or family member's income is added to your application to boost how much you can borrow. The home stays in your name only. It's a handy way to get more borrowing power without giving up a share of the property.
Buying with someone else
You don't need family money to team up. Getting a joint mortgage with a partner, friend or sibling can make a real difference, because you're combining your incomes and savings. Suddenly, homes that felt out of reach on your own start to look possible.
Whoever you buy with, have an honest chat about the future together. Yes, even if it’s the love of your life! Discuss what will happen if one of you wants to sell or move on, and get those decisions written down before you buy. It doesn't need to be awkward or complicated. A solicitor can help you put a simple agreement together so everyone feels protected and clear from day one.
How to boost your chances of getting a mortgage
Improve your credit score
Small habits make a big difference. Paying bills on time, registering to vote and checking your credit report for mistakes are all quick wins that can strengthen your application without much effort.
Reduce existing debts
If you can chip away at credit card balances, loans or overdrafts, it really helps. When those monthly payments shrink, more of your income is free to pay mortgage repayments, which can boost both your affordability and your chances of getting approved. Lenders like to see that your debts are moving in the right direction, and it can make your application look noticeably stronger.
Taking a bigger deposit
Even a small top up to your deposit can make a real difference. Lenders group mortgages into maximum loan to value (LTV) bands, and each band can unlock better rates.
Let’s crunch the numbers:
Property price £200,000.
Deposit £19,000 (9.5%)
LTV 90.5%.
With this deposit you don’t quite qualify for deals with a max LTV of 90%
But if you can save another £1,000, your deposit reaches £20,000 and your LTV drops to 90%. Many lenders offer more choice at this level, and you may be able to access lower rates too. It could be the difference between waiting one more month (and potentially getting a better deal) or having to flog your retro trainer collection on Vinted.
Extend the term
The term is how long your mortgage runs for, for example 30 years. The longer the term, the cheaper your monthly payments will be. The trade-off is that a longer term means more interest paid overall.
Here's a nifty trick, though: start with a longer term to help you get on the ladder now. Then, when you remortgage in a few years' time, hopefully with a payrise or two under your belt, you can shorten it back down.
Speak to a broker
Got any questions? That's what we're here for. A mortgage adviser can do the sums for you. They'll show you exactly where your deposit sits, how close you are to the next LTV band, and whether a small top up could improve your options.
They can also work out how different mortgage terms change your monthly payments. Real figures and facts, no guesswork required.
Ready to take the next step? Use our affordability calculator to see how much you might be able to borrow, or read our guide to buying your first home for more first time buyer help.
Ready to chat? Our advisers are ready to call you back today. The first chat costs nothing and is totally free of obligation.
Something to bear in mind...
Frequently asked questions
How to buy a home on a low income is a common question. The good news is that a mortgage adviser may have the answer. Shared Ownership, 95% mortgages, JBSP mortgages and some lender schemes are all designed to help people with lower incomes buy a home.
It's definitely possible, though your options may be a little more limited. It depends on the type of credit issue and how long ago it happened. A mortgage adviser can look at your credit report and explain what's possible for you.
It varies hugely from person to person. For some, it's a matter of weeks. For others, it might mean a year of building up a deposit or improving credit first. The best way to know for sure is to speak to an adviser, who can map out a realistic timeline just for you.