A guide to 95% LTV mortgages
Buying a home with just a 5% deposit is achievable for many UK buyers, but it helps to understand how 95% LTV mortgages work and what lenders look for. This guide explains the basics, the costs, and how to give yourself the best chance of approval.
In this guide
What is a 95% LTV mortgage?
LTV stands for loan-to-value, which is the percentage of the property’s value that you borrow. A 95% LTV mortgage means the lender provides 95% of the purchase price and you put down the remaining 5% as a deposit.
For example, on a £200,000 property you would need a £10,000 deposit and borrow £190,000. The higher the LTV, the more risk the lender takes on, which is why interest rates at 95% LTV are typically higher than at 90% or 85%.
Who offers 95% LTV mortgages?
Most major high street lenders now offer 95% LTV products, including Barclays, Halifax, HSBC, and Nationwide. Several building societies and specialist lenders also operate in this space, sometimes with more flexible criteria.
Availability can change quickly based on market conditions. A mortgage broker can give you an up-to-date picture of which lenders are actively lending at 95% LTV and which products offer the best value for your circumstances. You can also compare mortgage deals side by side.
What are the interest rates like?
Interest rates on 95% LTV mortgages are higher than those at lower LTV bands because the lender is taking on more risk. The difference can be significant — often 0.5% to 1% higher than a 90% LTV product on the same property.
However, rates have become more competitive in recent years. Fixing for two or five years is the most popular choice at this level, giving you certainty over your monthly payments while you build equity in your home.
Once you have built up enough equity, usually by reaching 90% LTV through repayments or house price growth, you can remortgage onto a cheaper deal.
Tips for getting approved
Lenders will scrutinise your finances carefully at 95% LTV. Make sure your credit report is in good shape, reduce any outstanding debts where possible, and avoid making large purchases or changing jobs in the months before you apply. If saving a deposit feels out of reach, shared ownership is another option worth considering.
Having a clear paper trail of your deposit is important. Lenders will want to see that the money has been saved over time or that any gifted deposit comes with a signed declaration from the person providing it.
Related guides
More guides in our 95% ltv mortgage hub.
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