Enter your details and click Calculate Deposit to see your deposit breakdown.
For guidance only. SDLT estimates based on England rates April 2025.
How House Deposits Work in 2026
A house deposit is the upfront cash you pay towards the purchase price of a property. The remainder is covered by your mortgage. The size of your deposit directly affects the mortgage rate you are offered, the total interest you pay over the life of the loan, and whether you need mortgage insurance.
In the UK, the minimum deposit accepted by most lenders is 5% of the property price, although 10–15% is considered standard and 25%+ unlocks the best rates. Buy-to-let properties typically require a minimum 25% deposit.
Deposit Tiers & Typical Mortgage Rates (2026)
| Deposit % | LTV Ratio | Typical 2-Year Fixed Rate | Monthly Payment (£250k, 25yr) |
|---|---|---|---|
| 5% | 95% | 5.5–6.2% | £1,283–£1,350 |
| 10% | 90% | 4.8–5.4% | £1,216–£1,283 |
| 15% | 85% | 4.4–5.0% | £1,178–£1,216 |
| 20% | 80% | 4.1–4.6% | £1,148–£1,178 |
| 25%+ | 75% or less | 3.8–4.3% | £1,119–£1,148 |
Rates are indicative based on average UK lender offerings as of March 2026. Your actual rate depends on credit score, income, and lender criteria.
What Changed in 2026
From 1 April 2025, the SDLT nil-rate threshold returned to £125,000 for standard buyers and £300,000 for first-time buyers (down from the temporary £250,000/£425,000 thresholds). This means buyers now face higher stamp duty bills, making the deposit an even larger proportion of the total upfront cost.
The Lifetime ISA remains available with a £450,000 property price cap. The Mortgage Guarantee Scheme continues to support 95% LTV lending through participating high-street lenders. No new government deposit assistance schemes have been announced for 2026.
For buy-to-let investors, the 3% additional property surcharge still applies on top of standard SDLT rates, further increasing the total cash needed at completion.
Deposit Planning Guides
Your deposit is just one part of the upfront cost of buying a home. Use our other tools to build a complete budget:
- Stamp Duty Calculator — find out exactly how much SDLT you owe on top of your deposit, based on property price and buyer type.
- Mortgage Affordability Calculator — check how much you can borrow based on income, outgoings, and deposit size before viewing properties.
- LTV Calculator — see which mortgage rate tier your deposit puts you in and how much extra deposit would save you.
- Moving Costs Calculator — budget for solicitor fees, surveys, removals and other costs beyond the deposit and stamp duty.
- Conveyancing Calculator — estimate legal fees for the purchase including searches, Land Registry, and disbursements.
✅ Rates verified against HMRC and gov.uk data, March 2026. This calculator is for guidance only and does not constitute financial advice. Always consult a qualified mortgage adviser before making financial decisions.
Worked Examples
Example 1 — 10% Deposit on £250,000
Property price: £250,000
Deposit: 10% = £25,000
Mortgage needed: £225,000
LTV: 90% — Deposit: £25,000
Example 2 — 15% Deposit on £350,000
Property price: £350,000
Deposit: 15% = £52,500
Mortgage needed: £297,500
LTV: 85% — Deposit: £52,500
Example 3 — 25% Deposit on £500,000
Property price: £500,000
Deposit: 25% = £125,000
Mortgage needed: £375,000
LTV: 75% — Deposit: £125,000
Common Mistakes to Avoid When Saving for a House Deposit
Many first-time buyers make avoidable errors that delay their purchase by months or even years. Here are five of the most common deposit mistakes and how to steer clear of them.
1. Underestimating the Total Cash Needed
A 10% deposit on a £300,000 home is £30,000, but you also need £5,000–£15,000 for stamp duty, solicitor fees, surveys and moving costs. Saving only for the deposit itself leaves you short at exchange.
2. Ignoring Loan-to-Value Thresholds
Mortgage rates drop significantly at key LTV bands—90%, 85%, 80% and 75%. Falling just £1,000 short of the next threshold could cost you thousands in extra interest over a 25-year term. Always check which LTV bracket your deposit places you in.
3. Not Using a Lifetime ISA
The Lifetime ISA gives you a 25% government bonus on savings up to £4,000 per year—that is £1,000 of free money annually. Many eligible buyers under 40 miss out simply because they never open one. The property must be £450,000 or less to qualify.
4. Saving in a Current Account
Leaving your deposit fund in a zero-interest current account means inflation erodes its value every month. In 2026, easy-access savings accounts and fixed-rate bonds offer 4–5% interest, which could add over £1,000 a year to a £25,000 pot.
5. Rushing to Buy Without Comparing Mortgage Deals
Accepting the first mortgage offer without shopping around can mean paying a higher interest rate for years. Using a whole-of-market mortgage broker or comparison site can save you £200–£400 per month on repayments, depending on property value and deposit size.
5 Steps to Saving Your House Deposit
- Set a realistic target. Decide on a property price range and deposit percentage (aim for at least 10%). For a £275,000 home at 10%, your target is £27,500 plus roughly £8,000–£12,000 for additional purchase costs.
- Open a Lifetime ISA or savings account. If you are a first-time buyer under 40, a LISA maximises your savings with the 25% government bonus. Otherwise, use a high-interest fixed-rate savings account to beat inflation.
- Create a monthly savings plan. Work out how much you can set aside each month after essential expenses. Automate the transfer on payday so you are not tempted to spend it. Even £500 per month reaches £18,000 in three years before interest.
- Explore additional funding sources. Check whether you qualify for shared ownership, the First Homes scheme (30% discount for eligible buyers), or a family gifted-deposit arrangement. Some lenders also accept concessionary purchases below market value.
- Get a mortgage agreement in principle. Once your deposit is close to target, apply for an AIP. This confirms what you can borrow, locks your budget, and shows estate agents you are a serious buyer—giving you an edge in competitive markets.
Deposit Comparison by Property Price
The table below shows how different deposit percentages affect the amount you need to save and your resulting LTV ratio. A higher deposit means a lower LTV, which typically unlocks better mortgage rates.
| Property Price | 5% Deposit | 10% Deposit | 15% Deposit | 20% Deposit | 25% Deposit |
|---|---|---|---|---|---|
| £150,000 | £7,500 | £15,000 | £22,500 | £30,000 | £37,500 |
| £250,000 | £12,500 | £25,000 | £37,500 | £50,000 | £62,500 |
| £350,000 | £17,500 | £35,000 | £52,500 | £70,000 | £87,500 |
| £450,000 | £22,500 | £45,000 | £67,500 | £90,000 | £112,500 |
| £600,000 | £30,000 | £60,000 | £90,000 | £120,000 | £150,000 |
Did You Know?
Pro Tips for Building Your Deposit Faster
Financial advisors recommend: Set up a standing order to a dedicated savings account on the day you get paid. Treating your deposit contribution like a fixed bill ensures you save consistently, and most people adjust their spending within a few weeks without noticing.
Mortgage brokers suggest: If you are close to an LTV threshold—say 91% LTV when 90% would unlock a better rate—consider asking family for a small gifted deposit to bridge the gap. Lenders accept gifted deposits from immediate family with a signed letter confirming it is not a loan.
HMRC notes: Withdrawing from a Lifetime ISA for any purpose other than buying your first home (or after age 60) incurs a 25% penalty, which means you lose more than the bonus. Make sure you only use a LISA if you are confident you will buy a qualifying property within your timeline.
Estate agents suggest: In slower markets, vendors may accept offers 5–10% below asking price. A lower purchase price reduces both your required deposit and your stamp duty bill—on a £350,000 property, a 7% discount saves £24,500 off the price and up to £1,225 in stamp duty.
Potential Savings on Your House Deposit Journey
Use a Lifetime ISA
£5,000+
Save £4,000 a year for five years and the 25% government bonus adds £5,000 on top—plus interest. That is free money towards your deposit with no catch for eligible first-time buyers.
Hit the 90% LTV Threshold
£25,000–£35,000
Moving from a 95% to 90% LTV mortgage on a £300,000 property typically lowers your rate by 0.3–0.5%, saving £25,000–£35,000 in total interest over a 25-year term.
Negotiate the Purchase Price
£10,000–£25,000
Negotiating 5–7% off a £350,000 asking price saves £17,500–£24,500 on the price, reduces your deposit requirement by £1,750–£2,450 (at 10%), and cuts stamp duty by up to £1,225.
House Deposit FAQs
Everything you need to know about saving for a house deposit in 2025.