I want to buy a home but have no deposit: how to start (guide)

Starting a home purchase without a cash deposit is challenging but not impossible in the UK. A few lenders offer high loan-to-value routes, and there are part-buy schemes and family-assisted options that can bridge the gap. You will still need to prove affordability and cover non-deposit costs like legal fees, valuation, surveys, and moving expenses. Preparing early, understanding each path’s risks, and documenting your finances clearly will make a significant difference.

What are lender requirements for high-loan mortgages?

High-LTV lending (95% and sometimes 100%) comes with strict criteria. Lenders typically expect a clean credit history, stable income, and sensible levels of unsecured debt. Affordability is stress-tested, often at rates higher than what you’ll actually pay, and income multiples commonly sit around 4–4.5×, varying by lender and applicant profile. For 100% LTV products linked to rental history, you may need at least 12 months of on-time rent payments and evidence that the proposed mortgage payment is comparable to your current rent. Property type and valuation matter: some lenders exclude certain new-builds or require stronger affordability for flats. Even with no deposit, set aside funds for professional fees and insurance.

How does guarantor and family-assisted financing work?

Family-assisted borrowing can replace a cash deposit or boost affordability. Two common structures are linked-savings security and joint borrower, sole proprietor (JBSP): - Linked-savings security: A family member places funds—often around 10% of the purchase price—into a ring‑fenced account as collateral for a fixed term. If repayments are kept up, the helper’s funds are returned with interest; if not, some or all may be at risk. - JBSP: A parent or close relative is added to the mortgage to lift affordability, but they do not own the property. All borrowers are jointly responsible for payments, which may affect the helper’s own borrowing capacity. In both cases, lenders can set age thresholds, income and property criteria, and may require independent legal advice for the helper. Check whether and when a helper can be released from the arrangement once your affordability strengthens.

What are shared ownership schemes?

Shared ownership lets you buy a share of a home (often 10%–75%) from a housing association and pay rent on the remainder. Because your deposit is calculated on the share you buy, the upfront cash required can be lower than for an outright purchase. Typical eligibility includes being a first-time buyer or unable to buy on the open market, with household income caps (commonly up to £80,000 outside London and £90,000 in London). Over time, you can “staircase” by purchasing more shares—each step involves valuation, legal costs, and potentially increased mortgage payments as your ownership rises. Budget for rent on the unsold share, service charges, maintenance, and any restrictions on subletting or resale. Lease terms vary, so review them carefully.

What documents are needed for affordability checks?

Organise paperwork before you apply to reduce delays. Common requirements include: valid photo ID and proof of address; three months of payslips and your latest P60; for the self‑employed, two years of accounts or SA302s with tax year overviews; three to six months of bank statements; details of loans, cards, childcare, and other commitments; proof of rental payments if relevant; and evidence of the deposit source or family security. Lenders may ask for employment contracts, probation details, or benefit award letters. Clean up your credit files, cancel unused credit lines where appropriate, and ensure transactions align with declared income and expenses. Using local services in your area—such as a regulated mortgage adviser and a conveyancer—can help you meet specific lender standards.

How do you compare mortgage products effectively?

Look beyond the headline rate and compare the total cost of borrowing over the fixed or initial period. Consider arrangement and valuation fees, legal costs, APRC, early repayment charges, overpayment allowances, portability, and how long you intend to stay put. If using a helper, confirm when and how they can be released, how linked savings earn interest, and what happens if property values fall. For shared ownership, factor rent on the unsold share, service charges, staircasing costs, and resale rules. Build a simple spreadsheet to model monthly outgoings under different scenarios so you can judge resilience if rates or costs change.

A quick pricing snapshot can help set expectations. Real fees vary by lender and property, but typical figures include valuation £200–£700+, conveyancing £800–£1,500+, and product fees from £0 to around £999. For shared ownership, deposits are often 5% of your chosen share, with rent payable on the remainder and service charges that can range widely depending on the building.

Prices, rates, or cost estimates mentioned in this article are based on the latest available information but may change over time. Independent research is advised before making financial decisions.

Conclusion

Buying with little or no deposit demands careful planning and realistic budgeting. By understanding lender criteria for high-LTV mortgages, weighing the risks and responsibilities of family-assisted options, and assessing the long-term costs of shared ownership, you can identify a route that aligns with your finances and time horizon. A structured comparison of total costs and terms reduces surprises and supports a measured, sustainable decision.