First-Time Buyer Deposit Tips: Here's How Much Deposit You Need
- Paul Dean
- Dec 16, 2025
- 4 min read
Buying your first home is exciting. It’s a big step, and knowing how much deposit you need can make the process smoother. I’m here to guide you through the essentials. Let’s break down what you need to know about saving for your first home deposit.
Why Your Deposit Matters
Your deposit is the money you pay upfront when buying a house. It shows lenders you’re serious and lowers their risk. The bigger your deposit, the better your mortgage deal can be. It can mean lower interest rates and smaller monthly payments.
For example, if you want to buy a house worth £200,000, a 10% deposit means you need £20,000 saved. The rest you borrow from the lender. The size of your deposit affects how much you can borrow and the type of mortgage you get.
Saving for a deposit might feel tough, but it’s worth it. The more you save, the more options you have. Plus, a larger deposit can help you avoid paying extra fees like mortgage insurance.
First-Time Buyer Deposit Tips to Help You Save
Saving for your first home deposit doesn’t have to be overwhelming. Here are some practical tips to get you started:
Set a clear goal: Know how much you need. Research house prices in your area to set a realistic target.
Create a budget: Track your income and expenses. Cut back on non-essential spending.
Open a dedicated savings account: Keep your deposit money separate. Look for accounts with good interest rates.
Automate your savings: Set up a monthly transfer to your savings account. Even small amounts add up.
Use government schemes: Check if you qualify for Help to Buy or Shared Ownership schemes.
Consider extra income: Freelance work or part-time jobs can boost your savings.
Avoid new debts: Keep your credit clean to improve your mortgage chances.
Remember, saving takes time. Be patient and stay focused on your goal. Every little bit helps.
What is the Minimum Deposit for a First-Time Buyer Mortgage?
The minimum deposit varies depending on the lender and the type of mortgage. Typically, you’ll need at least 5% of the property price. Some lenders may require 10% or more.
For example, on a £150,000 home, a 5% deposit is £7,500. But keep in mind, a larger deposit often means better mortgage rates and lower monthly payments.
Some lenders offer deals for first-time buyers with smaller deposits, but these might come with higher interest rates or fees. It’s important to shop around and get advice tailored to your situation.
If you want to explore your options, you can check out first time buyer mortgage deposit deals to find what suits you best.
How to Boost Your Deposit Faster
If you want to speed up your savings, here are some extra ideas:
Downsize your living arrangements: Rent a smaller place or move in with family temporarily.
Sell unused items: Clear out clutter and make some cash.
Cut subscriptions: Cancel services you don’t use.
Save windfalls: Put bonuses, tax refunds, or gifts straight into your deposit fund.
Use cashback apps: Earn rewards on everyday spending.
Avoid lifestyle inflation: Don’t increase spending as your income grows.
Every pound saved brings you closer to your dream home. Keep your eyes on the prize!
What Happens After You Save Your Deposit?
Once you have your deposit, the next steps are crucial. You’ll need to:
Get a mortgage agreement in principle: This shows sellers you can afford the property.
Find a property: Work with estate agents or search online.
Make an offer: Negotiate the price.
Arrange a survey: Check the property’s condition.
Complete the mortgage application: Submit all documents.
Exchange contracts: Pay your deposit to the seller.
Complete the sale: Finalise the mortgage and get the keys.
Having your deposit ready makes this process smoother. It shows you’re ready to buy and can speed up the sale.
Buying your first home is a journey. With the right deposit and good advice, you’ll be well on your way to owning your own place.
If you want expert help tailored to your needs, PD Finance is here to guide you. They offer whole-of-market advice to find the best mortgage and protection deals for you. Your dream home is closer than you think!
> We do not charge a fee for staying with your current lender (also known as a Product Transfer). Our typical fees are £250 for a remortgage, £500 for a purchase mortgage, and £750 for an adverse credit mortgage; however, this will depend on your circumstances, and the exact fee will be confirmed at your free initial consultation.
> Your home or property may be repossessed if you do not keep up with repayments of your mortgage or any other debt secured against it.
> You may have to pay early repayment charges to your existing lender if you remortgage.
> All broker fees are non-refundable.
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