If you’re a first-time buyer struggling to save for a deposit, 100% mortgages (also known as no-deposit mortgages) are available in the UK. These deals let you borrow the entire purchase price of a property — but they’re not risk-free. I will explain how they work, who offers them, and whether a 100% mortgage is the right move for you.
What Is a 100% Mortgage?
A 100% mortgage means you borrow 100% of the property’s value. (No deposit required)
Who Is Currently Offering 100% Mortgages in the UK?
Here are a couple of lenders that are known to be offering 100% mortgages.
Skipton Building Society
If you are currently renting Skipton Building Society have a product called Track Record Mortgage.
They are offering up to 100% loan to value mortgage if you are currently renting and have proof of having paid rent and household bills for the last 12 months. You also have to be over 21 years old and not owned a property in the UK for the last 2 years.
April Mortgages are a new lender to the market offering 100% mortgages
Minimum income £24,000
No Early repayment charges
Overpayments allowed
Fixed rates over 10 or 15 years
They will reduce your fixed rate if you can create equity in the property (Overpayments, increase the value of the property)
No New Builds or Flats
Key Risks of Taking a 100% Mortgage (Especially for First-Time Buyers)
- Negative Equity Risk
Without any deposit, you start with zero equity — if house prices fall, you could end up owing more than your home is worth. - Higher Interest Rates
Because no-deposit mortgages are considered riskier, lenders may charge a premium, resulting in higher monthly repayments. - Limited Lenders and Products
Not many lenders are offering 100% mortgages, so your options will likely be narrower. - Strict Eligibility Criteria
You may need a very good credit history, proof of income, and in some cases, a strong rental payment record. - Remortgaging Challenges
If you have little or no equity later on, it could be difficult to remortgage.
Pros: Why a First-Time Buyer Might Consider a 100% Mortgage
- Faster Access to Homeownership: Skip the long wait to save a deposit.
- Reduce Upfront Costs: Without a deposit, your initial cash requirement is lower.
- Leverage Rental History: If you’ve got a consistent rent payment record, some lenders see that as a strong signal of reliability.
- Build Equity Over Time: As you make mortgage payments over time, you gradually build equity (assuming house prices are stable or rising). Also Look to make overpayments.
Is a 100% Mortgage Right for You?
Here are some questions first-time buyers should ask themselves before applying:
- Can I comfortably afford higher monthly payments?
- Am I prepared for market fluctuations (i.e., the risk of negative equity)?
- Do I have a good credit score and stable income?
- How long do I plan to stay in the property?
- Do I want flexibility to remortgage or move in the future?
Tip, If You’re Considering a 100% Mortgage
My biggest tip? Speak to a mortgage broker who has experience in dealing with high loan to value mortgages. Don’t just think short term, think about how you’ll build equity, overpay, or remortgage when your fixed-rate ends.
Alternatives to 100% Mortgages
If a 100% mortgage doesn’t feel right for you, here are a few other options to consider:
- Shared Ownership: Buy a share of a property, and pay rent on the rest — a lower deposit might be needed.
- A Joint Borrower Sole Proprietor mortgage (JBSP) is when your family member joins you on your mortgage. It means your income and the income of your family member(s) is considered when you apply for a mortgage. This helps with affordability and you will still require a deposit. You may still need the Bank of Mum and dad for a deposit.
- Save for a Small Deposit: Even a 5% deposit can open up many more mortgage products at better rates.
For first-time buyers, a 100% mortgage can be an option to get on the property ladder — especially if you’ve struggled to save a deposit. But it’s not without real risks, particularly around negative equity and monthly affordability.
If you’re considering a no-deposit mortgage, the best next step is to speak with a qualified mortgage broker.
If you want to speak to me please feel to contact me on 0777 587 4126 or email me on daniel@middletonfinance.co.uk
The information contained within was correct at the time of publication but is subject to change.
Your home may be repossessed if you do not keep up repayments on your mortgage.
