First-time buyers – How much can I borrow and how much deposit will I need?

30 May 2023

A couple of weeks ago Skipton Building Society launched the first 100% mortgage since 2008 creating quite a stir. We thought a reminder of how much you can borrow and how much deposit you’ll need as a first-time buyer was a timely and useful topic to cover.


How much can I borrow?

As a rule of thumb, you can borrow roughly four and a half times your gross salary or combined gross salary if you are buying with someone else.

This crude calculation is subject to quite a few caveats, such as:

  • The individual lenders’ requirements
  • Your income and expenditure will be considered in an affordability check. The check will consider any other financial commitments you have such as car finance; personal loans; credit card debt etc.
  • You may have other income streams the lender will consider such as rental income from a buy-to-let; income from a trust fund; dividends from shares.



As mentioned above only one lender offers a 100% mortgage requiring no deposit. The rate on this product is higher than other products available where a deposit is required. Generally the bigger the deposit, the better the rate the lender can offer.

So, how much is enough? Most lenders ask for a minimum deposit of 10%, a few will take 5%. In recent years lenders have been asking for high deposits of 20%. With the average home costing around £300,000, a 20% deposit would be around £60,000, double the average salary in the UK!


Help to save for a deposit is available.

If you are saving for a deposit for your first home help is available from the government in the form of a Lifetime ISA savings account. The government will pay you a 25% bonus each year on savings up to £4,000. If you save a maximum £4,000 you will get £1,000 per year free.

Sounds great. But beware! You can only use this money and the bonus to buy your first home or in retirement. You can access the money if needed, however, you have to pay the 25% back to the government meaning you will end up with less than you've actually put in.

If you’re considering taking your first step on the property ladder and want to discuss the options available, call our advisers for a no-obligation chat, 020 3745 5893 or email

Your home or property may be repossessed if you do not keep up repayments on your mortgage.

For mortgages, we can be paid by commission or a fee of usually £495 or a combination of both. The actual amount will depend on your circumstances.