If you are looking to buy a home with a smaller deposit, there is good news: low-deposit mortgages are making a comeback and 2025 is shaping up to be one of the best years in nearly two decades to explore your options.

Whether you are a first-time buyer or moving home, here’s what the rise in low deposit loan-to-value (LTV) mortgages means for you and how Dan or Luke at SMH Finance can help you make the most of it.

More choice for buyers with 5–10% deposits

According to Moneyfacts, there are now 1,287 mortgage deals available at 90% and 95% LTV—the highest number since 2008.

• 442 deals at 95% LTV (just 5% deposit)
• 845 deals at 90% LTV (10% deposit)

That’s nearly double the choice buyers had just two years ago, opening up more opportunities for those who have been struggling to save large deposits.

Rates are improving too

It’s not just the number of deals that’s growing, rates for low-deposit mortgages are also slowly coming down:

• 95% LTV (5% deposit)
  – Two-year fixed average: 81% (lowest in over two years)
   – Five-year fixed average: 5.62%
  
  
• 90% LTV (10% deposit)
  – Two-year fixed average: 59%
   – Five-year fixed average: 5.33%

Mortgage rates have been falling steadily since last year, especially for fixed-rate deals. The difference between two- and five-year fixes is now just 0.14%, giving buyers more flexibility when choosing a term.

Why now could be a smart time to act

The mortgage market has settled in recent months, with more lenders competing for business, especially in the low-deposit space. That competition means better deals and more options for buyers with smaller deposits.

Don’t just go for the lowest rate - get the right advice

It’s tempting to jump at the lowest advertised interest rate, but the best mortgage deal isn’t always the one with the smallest number. Fees, flexibility and long-term affordability all matter too.

That’s where Dan or Luke at SMH Finance comes in. As experienced mortgage brokers, we search across a wide panel of lenders to find the right deal for your situation.

Telephone any of our local offices or email This email address is being protected from spambots. You need JavaScript enabled to view it.

As a mortgage is secured against your home, it may be repossessed if you do not keep up the mortgage repayments. This site is intended for UK residents only and the laws of England are applicable.