50% Deposit Mortgage

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50% Deposit Mortgage, Yellow Brick Mortgages
50% Deposit Mortgage, Yellow Brick Mortgages

50% Deposit Mortgage

Jamie Weavers and Mark Swaby explain 50% deposit mortgages and what these mean for you as a buyer.

Approved by The Openwork Partnership on 16/04/2024.

What is a 50% Loan to Value mortgage?

A 50% Loan to Value mortgage is exactly what it says on the tin. 50% of the property cost is funded by the client themselves by way of a deposit and the remaining 50% purchase is funded by the mortgage loan.

The deposit can obviously come by the same means as with any mortgage. As long as everything fits within the lender’s criteria, it’s absolutely fine.

Who can get a 50% deposit on a mortgage?

Anyone can get a 50% deposit mortgage, and it means you will access lower Loan to Value rates.

Whether you can get a 50% deposit mortgage will come down to two things. First, the deposit – whether you’ve got enough money from your own savings or from a gifted deposit from a rich or generous family member.

The second thing is the amount you’re borrowing. Have you got the income to warrant a lender lending you 50%? It doesn’t sound a lot, but a 50% mortgage on a £2 million property is still a million pounds!

A low Loan to Value is great and will get you a lower interest rate, but it still works on the basis that you can afford whatever you’re borrowing. The deposit also needs to come from a legitimate source.

What are the eligibility requirements for a 50% deposit mortgage? Is it easier to get a mortgage with a larger deposit?

Whether you have a 50% deposit or a 5% deposit, it all comes down to lenders’ criteria. Most mortgage lenders look to lend around four to 4.5 times your salary, so they will be checking that your income matches the requirement for what you need to borrow.

That will come down to affordability, lender criteria and obviously a full credit check and underwriting by the lenders.

How is a 50% Loan to Value mortgage repaid?

It’s repaid pretty much the same as a 95% mortgage. It would be repaid gradually over the term that you choose, on a monthly basis through a capital and interest repayment mortgage.

One of the benefits of having a lower Loan to Value is that lenders can become more open to letting clients borrow on an interest only basis. That will make your repayments cheaper, as all you’ve got to do each month is cover the interest on that mortgage.

It will be subject to some other criteria. as well. With an interest only mortgage you would repay the loan at a later stage – through either the sale of that property or from an investment or a pension pot. So a 50% Loan to Value mortgage can be good if you are looking at an interest only route.


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Our highly experienced Advisers are ready to help you with either buying or remortgaging a home, protecting your property and lifestyle along with saving you time and effort, ensuring you have a competitive deal right for you.

Can I apply for a mortgage with a 50% deposit if I have bad credit? Can I get a mortgage with a very poor credit score?

That’s a question we’re asked a lot. People think that they have bad credit, so they can’t get a mortgage. But that’s where a good advisor like us comes in handy. We are able to source a mortgage lender to accept your personal adverse credit situation.

We do all the background work to make sure we find a lender to accept you, where you fit the criteria.

So having bad credit doesn’t always mean it’s a no. Sometimes it means that the interest rates advertised in the media are not technically what you will be offered. It’s always worth being as honest as possible around credit score.

Even if you don’t mention it in our initial meetings, it will come out when you apply for a mortgage. So it’s best to tell us early, so we can select the correct lender for your personal circumstances. That way the mortgage will be accepted and you’ll be able to purchase the property you’re after.

What are the advantages and disadvantages of a 50% mortgage?

In terms of advantages, the biggest one is obviously that you get lower rates at 50% Loan to Value because there’s less risk to lenders.

But if you are putting a lot of money into a property to get a better rate, make sure you aren’t overstretching. You might later realise that you need some of that money to renovate the property, and end up getting personal loans instead. Don’t put all your money into that one property without considering what else you might need it for.

The benefit of a broker is that we can work out with you what is the most appropriate Loan to Value to target. As much as you want to get the lowest rates, we will see if you have a plan for some of that money to renovate the property, as well.

How do I apply for a mortgage with a 50% deposit?

The process is effectively the same as for any other mortgage application. Obviously, at the outset you have to find the property that you’re hoping to purchase. Once the offer’s been accepted we would make sure you’ve already got your Agreement in Principle in place – which means we have checked your affordability.

We’ll ensure that you’ve got the 50% deposit available and once your offer has been accepted we can then progress to a full mortgage application. You can either contact the lender directly or speak into a mortgage specialist like myself or Mark.

We look after the whole process of the mortgage application – uploading all your documents and ensuring it progresses to offer stage as smoothly and as stress-free as possible. House buying is deemed the most stressful thing that you can do in life, so let us make it easier.

How can a broker help with a 50% mortgage?

We guide you throughout the whole process and keep you updated. We’ll inform you about any rate changes to ensure that the process of purchasing the property or remortgage is as smooth as possible.

If there is a new rate that could be beneficial to you, as brokers we will switch the product to a better rate for you. We make sure that you remain on the most cost effective rate all the way up to completion.


Approved by The Openwork Partnership on  16/04/2024.