Saving for a house deposit can feel overwhelming, especially with rising house prices and the cost of living. But getting on the property ladder may be more achievable than you think.
In Episode 1 of On The Ladder, Sarah Tucker, founder of The Mortgage Mum and a regular contributor to This Morning, the BBC and The Times, breaks down exactly what a house deposit is, how much you really need in today’s market, and the mortgage schemes that could help you buy with a low or even no deposit.
She’s joined by Gemma Bennett, Acting Senior Mortgage Adviser at The Mortgage Mum, who shares practical insight from working directly with first-time buyers every day.
If you’re wondering how to save for a house deposit in the UK, this guide covers everything you need to know.
What Is a House Deposit?
A house deposit is the upfront cash contribution you put towards buying a property. It’s paid alongside your mortgage and directly affects:
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The mortgage deals available to you
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The interest rate you’ll receive
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Your monthly repayments
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Your likelihood of being approved
Your deposit is expressed as a percentage of the property’s value.
For example:
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Buying a £250,000 property
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5% deposit = £12,500
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10% deposit = £25,000
The remaining amount is borrowed as a mortgage.
How Much Deposit Do You Actually Need in the UK?
One of the biggest myths in the UK property market is that you need a 20% deposit to buy a home.
In reality, many lenders offer mortgages from 5% deposit (95% Loan to Value, or LTV).
Here’s what that looks like:
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5% deposit – Minimum for many first-time buyer products
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10% deposit – Opens up more competitive rates
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15–20% deposit – Access to lower interest rates and wider lender choice
While a larger deposit can mean better rates, waiting years to reach 15–20% isn’t always necessary. For many buyers, getting on the ladder sooner with 5–10% can make more financial sense.
A whole-of-market mortgage broker can help you compare both routes.
Strategic Ways to Save for a Deposit (Without Giving Up Everything)
You don’t have to eliminate every coffee or social plan to build a deposit. Saving strategically is far more effective than relying on restriction alone.
1. Set a Clear Target
Work backwards:
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What property price are you aiming for?
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What deposit percentage will you need?
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How long do you want to save for?
Clarity turns “I need to save” into a practical monthly plan.
2. Automate Your Savings
Treat your deposit like a non-negotiable bill. Set up a standing order the day after payday so you’re not tempted to spend it.
3. Use a Lifetime ISA (LISA)
If you’re aged 18–39, a Lifetime ISA can boost your savings by 25%. For every £4,000 saved annually, the government adds £1,000 (subject to eligibility and property price caps).
4. Consider a Gifted Deposit
Family members can gift part or all of your deposit. Lenders will require:
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A signed gifted deposit letter
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Confirmation it’s non-repayable
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Proof of funds
This can significantly shorten your saving timeline.
5. Increase Income, Not Just Reduce Spending
Side income, bonuses, tax rebates, selling unused items, or negotiating pay rises can accelerate your savings far more effectively than cutting small luxuries.
Low-Deposit & Alternative Mortgage Options for First-Time Buyers
If saving feels slow, there may be more options available than you realise.
5% Deposit Mortgages
Many lenders offer 95% LTV mortgages, allowing you to buy with just 5% upfront. These are ideal for first-time buyers with stable income and good credit history.
Shared Ownership
Homes England oversees shared ownership schemes, allowing you to:
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Buy a percentage of a property (e.g. 25–75%)
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Pay rent on the remaining share
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Purchase more shares over time (“staircasing”)
This reduces the deposit required because you’re buying a smaller portion of the home.
Guarantor Mortgages
A family member may support your application by:
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Acting as a guarantor
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Using their savings as security
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Adding their income to strengthen affordability
This can help buyers who are close to affordability limits.
Joint Borrower Sole Proprietor
This option allows a family member to go on the mortgage to boost affordability without being named on the property deeds.
Each option has pros and cons, so personalised advice is key.
How Lenders Assess Affordability
Your deposit is just one piece of the puzzle. Lenders also consider:
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Income (including bonuses or overtime)
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Existing debts
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Credit history
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Regular monthly commitments
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Dependants
Improving affordability may involve:
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Reducing credit card balances
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Avoiding new finance agreements
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Registering on the electoral roll
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Checking your credit report for errors
Even small adjustments can improve your borrowing potential.
Realistic Tips for Building a Deposit on a Lower Income
Buying on a modest salary is possible with the right structure.
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Start with an Agreement in Principle to understand your budget
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Look at areas with lower average house prices
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Consider buying with a partner or friend
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Explore new-build incentives
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Speak to a broker early — even before you’ve finished saving
Clarity creates momentum.
Take Your First Step On The Ladder
On The Ladder is a step-by-step series designed to guide UK first-time buyers through the property journey without jargon or confusion.
Episode 1 covers:
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What a house deposit really is
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How much you genuinely need
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Low-deposit and no-deposit routes
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Practical strategies to save faster
If you’re serious about buying your first home, the most powerful thing you can do is get clarity early.
Ready to explore your options? Speak to a qualified adviser at The Mortgage Mum and find out what’s possible for you.
Watch new episodes of On The Ladder every month.
Follow @the_mortgage_mum on Instagram and TikTok for ongoing expert guidance for first-time buyers in the UK.
