Thought buying a home without a deposit was impossible?
Think again.
Several lenders now offer 100% mortgages, making homeownership possible without spending years saving for a mortgage deposit.
Our specialist brokers, have helped hundreds of clients secure these no-deposit mortgages. Perfect for those with good incomes and clean credit who simply haven’t been able to save while paying high rent.
Ready to stop renting and start owning? Let’s explore your options.
100% Mortgages
100% Explained
This section is where we state the obvious!
With a 100% mortgage the lender will give you a mortgage for 100% of the purchase price of the property you are buying.
So, if you have agreed to buy a home for £400,000 then your mortgage will be for £400,000.
This is also called a no-deposit mortgage.
What Is LTV?
LTV stands for Loan-to-Value.
It represents the percentage of your property’s value that you’re borrowing from the lender.
Every lender will want to know the loan to value of each mortgage that they take on, as it forms part of their risk assessment.
For example, if you buy a £400,000 home with a £40,000 (10%) deposit, you’d need a mortgage of £360,000.
This gives you an LTV of 90% (£360,000 ÷ £400,000 × 100 = 90%).
Most standard mortgages require at least a 10% deposit (90% LTV). Some first-time buyer mortgages go up to 95% LTV, meaning you’d need a 5% deposit.
A 100% LTV mortgage means borrowing the entire property value with no deposit at all.
LTV Calculator
How These Mortgages Work
A 100% LTV mortgage lets you borrow the entire purchase price of your home.
You make monthly payments just like a standard mortgage, but skip years of deposit saving.
You will need to have a fixed rate of between 5 and 10 years, depending on the lender.
This means that your monthly payment won’t change for the term of the interest rate.
Repayment Method
Capital and interest (repayment) only.
Interest Rate
5 or 10 year fixed rate, depending on the lender.
Overpayments?
Overpayments of up to 10% of the mortgage amount are usually possible.
ERC
Yes, there will be early repayment charges for the duration of the fixed rate.
Fees
Yes, there will be an upfront product fee or application fee, this cannot be added to the mortgage.
Joint Mortgage
Up to two people can apply for a no-deposit mortgage.
Pros and Cons of 100% Mortgages
Every mortgage deal has its own limitations, the risks and rewards will depend on your own circumstances.
Pros
Immediate homeownership: Skip years of saving for a deposit while house prices potentially rise further.
Escape the rent trap: Convert your monthly housing payment into an investment in your future rather than paying a landlord.
Financial flexibility: Use any savings you have for moving costs, home improvements, or emergencies instead of depleting them for a deposit.
Building equity earlier: Start building ownership in your property right away instead of waiting years while renting.
Independence: Purchase without needing financial help from family members or inheritance.
Potential for property value growth: Benefit from any increase in your home’s value, which you’d miss out on during years spent saving.
Cons
Higher interest rates: Expect to pay 0.5-1.5% pa more in interest compared to mortgages with deposits.
Negative equity risk: If property values fall, you could end up owing more than your home is worth, making it difficult to sell or remortgage.
Stricter eligibility: You’ll need excellent credit, stable employment, and a higher income than for standard mortgages.
Limited property options: Most lenders restrict these mortgages to houses only (not flats) and may exclude new builds.
Higher overall cost: Over the full mortgage term, you’ll typically pay more in total interest than with a lower LTV mortgage.
Fewer lenders to choose from: Only a handful of specialist lenders offer these products, limiting your options.
Not always portable: If you want to move during the fixed rate period not all lenders will allow you to take your mortgage deal with you.
100% Mortgages
Who Qualifies?
To borrow 100% you’ll need strong income (£24-£27K depending on lender) and excellent credit history.
Most lenders cap borrowing at 4.49x your annual household income, with some offering up to 5.5x for key workers.
Your credit record must be spotless – no CCJs, defaults, or missed payments. Some lenders also want to see a 12-month history of on-time rent payments.
Most products target first-time buyers, though some are available to those moving home.
Ready to explore your options?
If you’re just about to start a new mortgage journey and could use the guiding hand of a professional, don’t hesitate to reach out to a reputable mortgage broker.
An independent mortgage broker can access over 100 lenders on your behalf. They will make the process smoother and more profitable than going it alone.
Keep reading, keep asking questions. The more you know, the better decisions you can make.
Find a mortgage broker
Benefits of a No-Deposit Mortgage
Get on the Property Ladder Sooner
The biggest hurdle for most first-time buyers is saving enough for a deposit while paying rent.
With house prices in many areas of the UK continuing to rise, the deposit goal posts keep moving further away.
A 100% LTV mortgage eliminates this barrier completely. Rather than spending another 3-5 years saving for a deposit, you could become a homeowner within months.
Consider this: If you’re currently paying £1,000 in monthly rent, that’s £60,000 over five years – money that could have been building equity in your own property. 100% mortgages let you start building that equity right away.
Keep Your Savings for Other Expenses
Buying a home involves more than just the deposit.
There are solicitor fees, survey costs, moving expenses, and often immediate home improvements or furniture purchases.
With a 100% mortgage, any savings you do have can go toward these other essential costs.
You might use your savings to:
- Cover your legal fees and searches
- Pay for a more comprehensive homebuyer’s survey
- Purchase essential appliances
- Redecorate to make the space your own
- Create an emergency fund for unexpected repairs
This can make the early months of homeownership much less financially stressful than if you’d emptied your accounts for a deposit.
Alternative to Family Help
Not everyone has the “Bank of Mum and Dad” to help with a deposit.
For many first-time buyers, family financial support simply isn’t an option.
100% LTV mortgages provide a genuine alternative path to homeownership without needing financial help from family members.
These products are based purely on your own financial standing – your income, your credit history, and (for some lenders) your history of paying rent on time.
This independence can be incredibly empowering.
Rather than waiting for an inheritance or relying on gifts from family, you can take control of your housing situation based on your own financial merits.
Who Can Apply?
Because the lender is taking on all of the mortgage risk, they need to be more careful than usual about who they lend to.
This means more rigorous checks, and a focus on affordability.
Income Requirements
Lenders need to be confident you can afford the repayments, so income requirements tend to be stricter than with standard mortgages.
Most lenders set minimum income thresholds – April Mortgages requires at least £24,000 per year, Hanley Economic Building Society asks for £25,000, and Gable Mortgages sets the bar at £27,780 (or £25,000 for key workers).
As for how much you can borrow, lenders typically cap loans at around 4.49 times your annual household income. Some offer higher multiples for certain professions; up to 5 times income for single key workers and 5.5 times for joint key worker applications.
Your employment stability is important.
You’ll generally need at least 6-12 months with your current employer, having completed any probationary period. Self-employed applicants usually need at least two years of accounts.
Credit History
Your credit history becomes even more important when borrowing 100%.
Lenders need to see evidence that you manage debt responsibly.
These mortgages typically require a clean credit history with:
- No County Court Judgments (CCJs)
- No defaults
- No bankruptcy or Individual Voluntary Arrangements (IVAs)
- No missed mortgage payments
- All credit accounts up to date with no late payments in the last 12 months
Even minor credit issues like occasional late payments could affect your application. That’s why it’s worth checking your credit reports from all three major UK credit reference agencies before applying.
Remember, lenders are taking on more risk with 100% mortgages, so they compensate by being more selective about who they lend to.
Rent Payment History
For some lenders, your rent payment history plays a key role in the application.
Skipton’s Track Record Mortgage, for example, requires evidence of 12 months of on-time rent payments.
This makes perfect sense – if you’ve consistently paid rent that’s similar to or higher than your potential mortgage payment, it demonstrates you can manage the financial commitment of a mortgage.
To strengthen your application, gather evidence of your rental payments for at least the last 12 months. Bank statements showing regular payments to a landlord or letting agency can help, as can formal references from your landlord.
Not all 100% mortgage products require rental history proof. April Mortgages, for instance, performs standard affordability checks without specifically requiring evidence of rental payments.
First-Time Buyer Focus
A lot of the 100% LTV mortgages target first-time buyers specifically, particularly for their advertising.
But don’t let this put you off.
There are no-deposit options for people moving home and those that currently live with family, rather than formally renting.
CONTACT A MORTGAGE BROKER
If you are ready to take the next step then we can put you in touch with a fully qualified independent mortgage broker.
Property Types and Restrictions
Not all properties qualify for 100% mortgages.
Each lenders will have their own restrictions to protect themselves against properties that might be difficult to sell if they had to repossess.
Eligible Property Types
Houses are generally accepted by all lenders offering 100% mortgages.
However, April Mortgages and Skipton Building Society specifically exclude flats and new-build properties. Gable Mortgages does consider flats and maisonettes, provided they meet certain criteria.
When it comes to construction types, most lenders prefer conventional brick and tile. Modern timber-framed houses with brick external walls are typically acceptable to Gable Mortgages, but more unusual construction methods might be excluded.
Older properties with specific issues may require additional surveys or reports. For example, Gable Mortgages, along with other lenders, requires specialist reports for properties with Japanese Knotweed or certain structural concerns.
Location Restrictions
Geographic limitations vary between lenders. Most mortgage products are available across England and Wales, with some extending to the whole of the UK.
Hanley Economic Building Society’s Rent-to-Own Mortgage is much more restricted, being available only to properties in the Stoke-on-Trent (ST) postcode area. This regional focus allows them to offer a specialised product with detailed local knowledge.
Other lenders may have additional restrictions in certain areas. For example, some might be extra cautious about lending on properties in flood risk areas or regions with declining property values.
Property Value Limits
Each lender sets minimum and maximum property values for their 100% mortgage products.
April Mortgages considers properties valued between £75,000 and £2 million (up to £2.5 million in Greater London), with a maximum loan amount of £600,000.
Skipton also caps loans at around £600,000, while Hanley’s regional product has a maximum loan size of £350,000 and a minimum of £30,000.
Gable Mortgages requires properties to be worth at least £125,000, with loans ranging from £125,000 to £1 million.
These limits reflect the lenders’ appetite for risk and their target markets. Higher-value properties might require specialist lending solutions beyond standard 100% mortgage products.
Interest Rates
You won’t be able to access the full range of interest rates.
To improve future affordability, lenders will restrict your choices to between 5 and 10 years.
Interest rates for 100% mortgages are a bit higher than standard mortgages requiring deposits.
This reflects the increased risk to lenders when there’s no deposit buffer.
What makes April Mortgage’s product interesting is that the interest rate decreases automatically as your loan-to-value ratio reduces over time.
This means you’ll benefit from a lower rate as you build equity through your repayments.
Once any fixed rate period has ended, you’ll normally move onto the lender’s Standard Variable Rate (SVR) unless you remortgage or do a product transfer.
SVR’s are to be avoided as they are more expensive.
Fees
Two things to bear in mind regarding fees when you borrow 100%:
- They are likely to be higher than a deal that requires a deposit
- You won’t be able to add the fee to the mortgage balance
So while your savings aren’t required to contribute to the deposit, you’ll need to pay quite a few costs upfront.
Understanding the Risks
Negative equity is perhaps the biggest risk.
If property values fall, you could end up owing more than your home is worth. This will make moving or remortgaging difficult until you’ve built up more equity through repayments or property value increases.
Higher interest rates mean your monthly payments will be slightly more than with a standard mortgage requiring a deposit.
This affects affordability and the total amount you’ll pay over the life of the mortgage.
While the allure of being able to buy a home to live in is hard to ignore, you should be aware that you are signing up for at least 5 years with the lender.
This is the minimum fixed rate duration when you borrow 100%.
If you want to move before then, not all of the deals can be taken to a new property, meaning you pay high exit fees.
Also, when you do have the opportunity to remortgage, you need equity of at least 10% to give you some choice.
FAQ
Will I pay more with a 100% LTV mortgage?
Yes, you’ll typically pay more in two ways.
First, the interest rates are higher than standard mortgages requiring deposits.
Second, you’re borrowing more money overall.
Can I get a 100% mortgage with bad credit?
Probably not, but it does depend on the type of bad credit and how long ago it occurred.
What happens if house prices fall?
If house prices fall, you could find yourself in negative equity – owing more on your mortgage than your property is worth.
Are 100% mortgages safe?
100% LTV mortgages are regulated financial products, but they do carry more risk than standard mortgages. The main risk is negative equity if property values fall.
How does a lender decide how much I can borrow?
Lenders typically cap loans at around 4.49 times your annual household income, though some offer higher multiples for certain professions. They’ll also conduct affordability assessments looking at your outgoings and existing debts.
Can I make overpayments?
Yes, most lenders allow overpayments of up to 10% of the outstanding balance per year without penalties. Making overpayments can be a good strategy to build equity faster and reduce the risk of negative equity.
Can self-employed people get 100% mortgages?
Yes, but you’ll typically need at least two years of accounts or tax returns, prepared by a qualified accountant.
Should I use a mortgage broker?
Definitely. They will be able to search for the best mortgage, explain it to you and help with the paperwork.
