Can You Buy a House Without a Deposit?

 

If you are dreaming of owning a home but do not have savings for a deposit, you might be wondering if buying a house with no deposit is even possible. With house prices rising and lenders typically requiring at least 5% of the purchase price upfront, it can feel like homeownership is out of reach.

 

The good news is that while getting a mortgage without a deposit is challenging, there are ways to get on the property ladder with little or no savings. Let’s explore your options.

 

100% Mortgages – Are They Still Available?

 

Once upon a time, 100% mortgages were common, meaning you could borrow the full price of a property without needing a deposit. After the financial crash of 2008, most lenders scrapped these, but they are slowly making a comeback.

 

Some lenders now offer guarantor mortgages, also known as family-assisted mortgages. These allow you to borrow the full amount if a family member is willing to act as a guarantor or secure the loan against their savings or property.

 

For example:

 

• Barclays Family Springboard Mortgage allows a relative to put money into a savings account linked to your mortgage, which acts as security instead of a deposit.
• Skipton’s Track Record Mortgage is a new 100% mortgage designed for renters with a strong payment history, allowing them to buy without needing a deposit.

 

These options can be a lifeline for first-time buyers struggling to save while paying high rent.

 

Buying with Help from Family

 

If your family wants to help you onto the property ladder but cannot afford to gift a lump sum, there are ways they can support you.

 

• Joint Borrower, Sole Proprietor Mortgages – A parent or close relative can apply for a mortgage with you without being named on the property deeds. This helps boost affordability while keeping the home in your name.

 

• Gifted Deposits – Many first-time buyers rely on family members gifting them money for a deposit. Most lenders accept this as long as it is a true gift, not a loan that needs repaying.

 

If family support is an option, it can make securing a mortgage easier, but always take financial and legal advice before making any commitments.

 

Shared Ownership – Buy with a Smaller Deposit

 

Shared ownership is a great way to get onto the property ladder with a much lower deposit.

 

This scheme allows you to buy a share of a property (usually between 10% and 75%) and pay rent on the remaining share, which is owned by a housing association. Because you are only buying part of the home, the deposit required is much smaller than a standard mortgage. Also, the rent that you pay on the remaining share is often lower than rental amounts. The rent is usually 2.5% of the share that you are renting.

 

For example:

 

• A £200,000 home with a 5% deposit normally requires £10,000.
• With shared ownership, if you buy a 50% share, you only need a £5,000 deposit.

 

Later on, you can increase your share of the property until you own it outright, a process known as staircasing.

 

First Homes Scheme – Discounts for First-Time Buyers

 

If you are a first-time buyer and struggling to save for a deposit, the First Homes Scheme could help.

 

This government-backed initiative offers newly built homes at a 30% to 50% discount for eligible buyers, including key workers and those buying in their local area. Because the property price is lower, the required deposit and mortgage are also reduced, making it easier to buy without a large upfront sum.

 

Low Deposit Mortgages – The 5% Option

 

If a zero deposit mortgage is not possible, the next best thing is a low deposit mortgage.

 

Many lenders offer 95% mortgages, meaning you only need a 5% deposit. If you can save even a small amount, this could be a much easier way to buy a home than trying to find a larger deposit.

 

Some banks also offer government-backed mortgage guarantee schemes, making it easier for lenders to approve low-deposit mortgages.

 

No Deposit? No Problem.

 

If you have a high level of income and the borrowing power to allow you to do so, you could in some cases take a loan out for the full deposit amount that you need to buy the property. This will be case-specific and will require a full affordability check done by us to make sure it’s a viable option.

 

The loan will have to be keyed on the mortgage application as an ongoing commitment, so will not be suitable in all cases, especially when you already have a level of committed expenditure.

 

Is Buying Without a Deposit Right for You?

 

While there are ways to buy a house with no deposit, it is important to consider whether it is the right decision.

 

• 100% mortgages often come with higher interest rates since lenders see them as higher risk.
• Your monthly repayments will be larger compared to having a deposit.
• If property prices fall, you could end up in negative equity, where your home is worth less than your mortgage.

 

If you are unsure which option is best for you, getting advice from a mortgage expert can help you understand the pros and cons based on your situation.

 

Need Help Finding the Right Mortgage? Let’s Talk!

 

If you want to explore your options for buying a home with no deposit or a low deposit, I can help. I work with a variety of lenders and know which ones offer 100% mortgages, shared ownership, and low-deposit schemes.

 

Visit our mortgage advice page and request a callback today. Let’s find the best way to get you onto the property ladder, even if you have not saved a deposit yet.