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By Pete Mugleston | Mortgage Advisor

Pete has been a mortgage advisor for over 10 years, and is regularly cited in both trade and national press.

Updated: 4th May 2021*

In our guide to 95% LTV mortgage lenders, you’ll learn exactly which mortgage providers are willing to lend to customers with only 5% deposit, what kind of products they offer, and why it’s important to seek professional advice, even if you think you’ve found the right lender.

The following topics are covered below…

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Which mortgage lenders offer 95 percent LTV mortgages?

Five of the UK’s leading high street banks are offering mortgages for customers with 5% deposit through the mortgage guarantee scheme, and one other mainstream lender is set to join the initiative in the near future. Outside of the guarantee scheme, there are specialist lenders who have reintroduced 95% LTV products amid improving market conditions. Some of these lenders are broker-exclusive and don’t deal with the general public.

It’s also possible to get a 5% deposit mortgage through a lender that offers guarantor mortgages. These are largely limited to building societies and specialist mortgage providers.

Moreover, customers with modest deposits also have the option of Help to Buy mortgage lenders, which tend to be a mixture of high street banks and building societies as well as specialist lenders. The same also applies to Shared Ownership mortgage providers.

Mortgage guarantee scheme lenders

At launch, five high street lenders are offering mortgages under the guarantee scheme…

  • Lloyds
  • Natwest
  • Santander
  • Barclays
  • HSBC

A sixth lender is set to join the scheme in the near future in the shape of Virgin Money, but it remains to be seen whether others will add their support to it as well.

Mortgage guarantee scheme lenders are able to accept customers with 5% deposit, but it’s possible to put down up to 9%, and it could boost your chances of landing a good deal if you’re in a position to put down more than the absolute minimum.

Lenders are assessing guarantee scheme applications based on their general eligibility criteria, so professional advice is especially recommended if you have bad credit, are self-employed, are buying a ‘non-standard’ property or have low income, as these factors will increase your chances of mortgage rejection or being hit with high rates.

You can read more about the mortgage guarantee scheme in our blog.

Other 95% LTV mortgage providers

Since the mortgage guarantee scheme was announced, several lenders have launched their own 95% LTV mortgage products and made them available outside of the scheme.

The list of mortgage providers doing this is growing all the time, and it includes…

  • Accord Mortgages: Offering a 95% LTV product with a five-year fixed rate, £995 fee, free standard valuation and a maximum loan size of £500,000, based on an income multiple of 4.49 times salary. This is not available on flats, new builds and properties in Northern Ireland and can only be taken out through a mortgage broker.
  • Bank of Ireland: Offering a two-year fixed-rate 95% LTV mortgage with no product fee, a maximum loan size of £500,000, and an income multiple cap of 4.49 times salary. This is also exclusively available through mortgage brokers.
  • Skipton Building Society: Has introduced a 95% LTV 5-year fix with an interest rate of 4.17% and a 95% LTV 5-year fix at 4.52%, with the latter only available for Shared Ownership properties. Both products are fee-free.
  • Aldermore: At the time of writing, Aldermore has reintroduced 95% LTV mortgages for a limited period but has plans to bring them back permanently. Current products on offer include a 95% LTV two-year fix at 5.08% and a 95% LTV five-year fix at 5.28%.
  • Coventry Building Society: Has relaunched two 95% LTV mortgage products with five-year fixes. The maximum loan size is set at £400,000 and eligible customers can borrow up to four times their salary. The first product has a £999 product fee and an interest rate of 3.89% and the second is fee-free with a rate of 4.09%.
  • Darlington Building Society: Is offering a 95% LTV mortgage that’s exclusive to key workers. It’s a three-year fixed-rate deal with a £999 product fee, a £120 completion fee and a contribution of £300 from the lender towards the legal fees. The maximum loan size is £300,000 and this product is not available on new builds or flats.

The above were among the first lenders to reintroduce 95% LTV products following COVID-19’s impact on the market. More are expected to follow, so be sure to speak to a broker before you apply to check whether even better deals have since launched.

Moreover, it’s always worth applying through a mortgage broker as they will compare these lenders’ product ranges with the ones available through government schemes and other alternative options, so you can rest assured that you’ll find the right lender first time.

Help to Buy mortgage lenders

There are mortgage lenders who offer finance to customers with 5% deposit through the Help to Buy scheme. These are not 95% LTV mortgages as the government’s equity loan means you’d end up with more equity than what 5% deposit alone would get you.

Lenders who are currently accepting applications via the latest equity loan scheme (2021-2023) include Nationwide, Accord Mortgages, TSB, Santander, Aldermore, Natwest and Kensington Mortgages. See our guide to Help to Buy mortgage lenders for more information about these mortgage providers and how to choose the right one.

Shared Ownership mortgage lenders

Lenders including Virgin Money, Skipton Building Society and The West Brom are willing to consider 95% LTV Shared Ownership mortgage applications, and there are even mortgage providers who offer Shared Ownership mortgages with no deposit requirements at all.

You can read more in our guide to Shared Ownership mortgage lenders.

Guarantor mortgage lenders

Guarantor mortgage lenders could be a possible alternative if you can’t save up enough deposit on your own. If there’s a family member who’s willing to support you financially, it may be possible to get onto the property ladder this way, with 5% deposit or less made up of your own funds and your guarantor’s assets bulking up to loan-to-value ratio.

Lenders who currently offer guarantor mortgages include Bath Building Society, Kent Reliance, The Cambridge Building Society and more.

You can read more about how guarantor mortgages work in our standalone guide.

An overview of 95% LTV and 5% deposit mortgage lenders

The table in this section offers an overview of the lenders currently offering 5% deposit and 95% LTV mortgages. This is by no means a complete picture of the market, but we’ve aimed to provide a representative sample by including a mixture of high street mortgage providers and specialist lenders, as well as the lenders our customers enquire about the most.

Below are the 95% LTV and 5% deposit mortgage options available from some of the UK’s leading high street and specialist lenders…

Mortgage Lender Low Deposit Mortgage Options
Halifax
  • Mortgage guarantee scheme
  • Help to Buy
  • Shared Ownership
Barclays
  • Help to Buy
  • Shared Ownership
Nationwide
  • Help to Buy
  • Shared Ownership
Santander
  • Mortgage guarantee scheme
  • Help to Buy
  • Shared Ownership
Natwest
  • Mortgage guarantee scheme
  • Help to Buy
Lloyds
  • Mortgage guarantee scheme
  • Help to Buy
  • Shared Ownership
TSB
  • Help to Buy
  • Shared Ownership
HSBC
  • Mortgage guarantee scheme
Yorkshire Bank
  • Minimum deposit is currently 10% (90% LTV)
Royal Bank of Scotland
  • Minimum deposit is currently 10% (90% LTV)
Leeds Building Society
  • Help to Buy
  • Shared Ownership
Clydesdale
  • Minimum deposit is currently 10% (90% LTV)
Post Office Money
  • Minimum deposit is currently 10% (90% LTV)
Newcastle Building Society
  • Help to Buy
Virgin Money
  • Due to support mortgage guarantee in near future
  • Shared Ownership
  • Help to Buy
First Direct
  • Minimum deposit is currently 15% (85% LTV)
Aldermore
  • Offers 95% LTV mortgages outright
  • Help to Buy

*Last updated April 2021

**Please note that not all of the lenders listed as providing Shared Ownership mortgages necessarily offer 5% deposit mortgages through the scheme

Although this table offers a rough snapshot of the low deposit mortgage market, approaching one of these lenders directly isn’t recommended. There are a growing number of 5% deposit and 95% loan-to-value mortgage deals out there, so your best bet is to speak to a mortgage broker to gain access to every single one of them.

Why limit yourself to one lender’s product range when a broker who specialises in low deposit mortgages can open up a world of potentially better options to you? What’s more, they will guide you through the application process and offer bespoke advice throughout.

How to find the right mortgage lender

If you have a 5% deposit to put down, your choice of mortgage lenders will be more limited than somebody with 10% or more, and the chances of being hit with hefty interest rates are higher. This is especially true if you do all of the legwork finding a lender yourself.

Researching banks that offer 5 percent deposit mortgages and approaching one that takes your fancy isn’t the best way to go about things. This means you’d only have access to their products and potentially miss out on a better 95% LTV deal available elsewhere.

There can be serious pitfalls if you attempt to navigate the market alone, but the good news is that help is available. A mortgage broker who specialises in arranging low-deposit deals can help you find the right lender first time. They will track down all of the best products that you qualify for, so you won’t have to lift a finger. What’s more, they’ll help you with all of the paperwork and negotiate the most favourable deal possible on your behalf.

Speaking to a broker is the best way to boost your chances of finding the perfect lender, but it pays to do a bit of homework and get a rough idea of the market. Read on for information about specific 95% LTV mortgage lenders and the products they offer.

Looking for a 5% deposit mortgage lender? A broker can find the best one for you!

We’re here to help, take the hard work out of the process and put your mind at ease. We work with a network of brokers who specialise in low deposit mortgages, and they can do all of the legwork finding the right lender for you and negotiating the best deal with them.

We offer a free broker-matching service that will assess your needs and circumstances and handpick a mortgage advisor with the right knowledge and experience to get you approved for a low deposit mortgage. Speaking to them before you apply will boost your chances of finding the right lender straight away, and that could mean saving time and money.

Call 0808 189 2301 or make an enquiry and we’ll set up a free, no-obligation chat between you and an advisor who can find the right mortgage lender for you today.

Updated: 4th May 2021
OnlineMortgageAdvisor 2021 ©

FCA disclaimer

*Based on our research, the content contained in this article is accurate as of most recent time of writing. Lender criteria and policies change regularly so speak to one of the advisors we work with to confirm the most accurate up to date information. The information on the site is not tailored advice to each individual reader, and as such does not constitute financial advice. All advisors working with us are fully qualified to provide mortgage advice and work only for firms who are authorised and regulated by the Financial Conduct Authority. They will offer any advice specific to you and your needs. Some types of buy to let mortgages are not regulated by the FCA. Think carefully before securing other debts against your home. As a mortgage is secured against your home, it may be repossessed if you do not keep up with repayments on your mortgage. Equity released from your home will also be secured against it.

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