How much deposit do you need for an Islamic mortgage?
Some published Islamic mortgage products start at a 5% deposit, from Gatehouse Bank and Offa, but that option depends on the provider, the property and the transaction: a purchase can qualify where a remortgage does not. The other published deposit bands are 10%, 20% and 35%. This guide sets out the requirements provider by provider and shows how a larger deposit changes your rate and fees: the step from a 20% to a 10% deposit is the largest measured jump in price. The deposit optimiser shows what crossing the next tier is worth on your own figures.
The short answer
Providers publish a maximum finance-to-value, and your deposit is what is left: a 95% ceiling means a 5% deposit, an 80% ceiling means 20%. Every figure here is stated both ways.
The ceiling moves with who you are, what you are buying and how much you need, so read the conditions rather than the headline.
Maximum finance-to-value rules, and the deposits they imply
12 published ceilings across the three mainstream providers. These are eligibility rules: whether you can reach a finance-to-value at all. The pricing steps are measured further down. A ceiling without its conditions is not a fact you can use.
Check which published limits match my situation
| Provider | Deposit | Finance-to-value | Applies to |
|---|---|---|---|
| Gatehouse Bank | 5% | 95% | UK residents, houses and new-build houses, purchase, finance up to £600,000 |
| Gatehouse Bank | 10% | 90% | UK residents, houses, flats and new-build houses, finance up to £750,000 |
| Gatehouse Bank | 20% | 80% | UK residents, houses, flats and new-build houses, finance up to £2,000,000 |
| Gatehouse Bank | 20% | 80% | British expats and international residents, houses, flats and new-build houses, finance up to £2,000,000 |
| Gatehouse Bank | 25% | 75% | UK residents, British expats and international residents, finance up to £3,000,000 |
| Gatehouse Bank | 25% | 75% | new-build flats |
| Gatehouse Bank | 30% | 70% | UK residents, British expats and international residents, finance up to £5,000,000 |
| Offa | 5% | 95% | UK residents |
| Offa | 20% | 80% | British expats |
| StrideUp | 10% or 15% | 85% or 90% | houses and flats, published as two different figures on the provider’s own pages |
| StrideUp | 15% | 85% | new-build houses |
| StrideUp | 20% | 80% | new-build flats |
Published criteria checked . Every tier is on our comparison page.
The 80% cliff, measured
The ladder is not linear. From a 35% deposit to 20% the rate barely moves, and from 10% to 5% it costs 0.1 to 0.3 points. Moving from a 20% deposit to a 10% one costs 0.6 to 0.8 percentage points and the product fee rises, £0 to £999 and £499 to £999, across 2 providers and 6 like-for-like pairs.
| Step | Deposit | Rate change | Product fee | Pairs measured |
|---|---|---|---|---|
| 65% to 80% finance | 35% to 20% | -0.1 to +0.13 | £0 to £499 | 7 |
| 80% to 90% finance | 20% to 10% | +0.6 to +0.8 | £0 to £999 and £499 to £999 | 6 |
| 90% to 95% finance | 10% to 5% | +0.1 to +0.3 | unchanged | 6 |
The 6 pairs across the 80% boundary, product by product
A pair counts only when both products share a provider, product range, rate type and fixed period, and at least one customer on one transaction type could choose between them.
| Provider | Product | 20% deposit | 10% deposit | Difference | Product fee |
|---|---|---|---|---|---|
| Gatehouse Bank | 2 years fixed | 5.68% | 6.38% | +0.7 | £0 to £999 |
| Gatehouse Bank | 5 years fixed | 5.76% | 6.36% | +0.6 | £0 to £999 |
| Gatehouse Bank | 2 years fixed | 5.68% | 6.48% | +0.8 | £0 to £999 |
| Gatehouse Bank | 5 years fixed | 5.76% | 6.46% | +0.7 | £0 to £999 |
| Offa | 2 years fixed | 6.65% | 7.35% | +0.7 | £499 to £999 |
| Offa | 5 years fixed | 6.75% | 7.45% | +0.7 | £499 to £999 |
What this means in pounds
On a £250,000 home, a 20% rather than a 10% deposit is £25,000 more cash, worth 0.6 to 0.8 percentage points on the rate plus the fee difference. The calculator prices both on your figures.
This measures each provider's own ladder. The difference between providers at the same tier is a separate question, set out on the comparison page. Neither is a general claim about the market.
The deposit ladder: lowest fixed rate at each tier
Figures behind this chart
| Deposit | Period | Lowest | Product | Condition | Lowest without a condition |
|---|---|---|---|---|---|
| 35% deposit | 2-year fixed | 5.58% | Gatehouse BankGreen Fixed 2yr GHFU1746 | EPC A or B required | 5.68% (Gatehouse Bank Fixed 2yr HFU1750) |
| 35% deposit | 5-year fixed | 5.53% | Gatehouse BankGreen Fixed 5yr GHFU1748 | EPC A or B required | 5.63% (Gatehouse Bank Fixed 5yr HFU1752) |
| 20% deposit | 2-year fixed | 5.58% | Gatehouse BankGreen Fixed 2yr GHFU1747 | EPC A or B required | 5.68% (Gatehouse Bank Fixed 2yr HFU1751) |
| 20% deposit | 5-year fixed | 5.66% | Gatehouse BankGreen Fixed 5yr GHFU1749 | EPC A or B required | 5.76% (Gatehouse Bank Fixed 5yr HFU1753) |
| 10% deposit | 2-year fixed | 6.38% | Gatehouse BankGreen Fixed 2yr GHFU1738 | EPC A or B required | 6.48% (Gatehouse Bank Fixed 2yr HFU1742) |
| 10% deposit | 5-year fixed | 6.36% | Gatehouse BankGreen Fixed 5yr GHFU1740 | EPC A or B required | 6.46% (Gatehouse Bank Fixed 5yr HFU1744) |
| 5% deposit | 2-year fixed | 6.68% | Gatehouse BankGreen Fixed 2yr GHFU1739 | EPC A or B required; purchase only | 7.45% (Offa Fixed 2yr 95%) |
| 5% deposit | 5-year fixed | 6.66% | Gatehouse BankGreen Fixed 5yr GHFU1741 | EPC A or B required; purchase only | 7.55% (Offa Fixed 5yr 95%) |
See which tier your deposit lands on, and what it costs a month
What your deposit actually buys
With a home purchase plan your deposit is your opening share of the property. You and the provider own the home between you from day one, in the proportions you each put in.
A larger deposit always reduces the provider's share, and so the amount rent is calculated on. It may also move you onto a lower rental-rate tier, but not always: from a 35% deposit to 20% the rate changes by 0.13 points or less.
Price your deposit on real products Check which tiers you meet Ask an adviser your question
Can your deposit be gifted, and can you buy with none?
Three different things get called a gifted deposit, and they are not interchangeable.
- Gifted cash
- Someone else provides the deposit, at the same percentage. StrideUp's intermediary criteria accept a 100% gifted deposit from any number of sources, and can consider gifts from outside close family. Source, read .
- Gifted equity, buying from family below market value
- No cash deposit from you, because the discount stands in for it. Gatehouse removed the personal-funds minimum for these cases on , up to 75% finance-to-value: a £300,000 home bought from parents for £225,000 is financed in full, the £75,000 difference treated as gifted equity, subject to a surveyor confirming market value. Source. Offa publishes a comparable route with no deposit needed. Source, both read .
- What none of this is
- A 100% finance product. The equity is still there, arriving as a discount rather than cash, which is why Gatehouse caps the finance at 75% of market value.
Expats and international buyers
The mainstream non-UK routes we track top out at 80% finance-to-value, a 20% deposit. Gatehouse states up to 80% for UK expats and international residents; Offa's 90% and 95% products are UK-resident only.
Specialist providers for non-UK residents publish their own, generally lower, ceilings. They are listed on the provider register.
What we could not verify
StrideUp publishes two different ceilings for a standard property. Its consumer page states 90% finance-to-value, a 10% deposit; its intermediary criteria state 85%, a 15% deposit. We hold both: a deposit that clears 15% is fine either way, one between them is genuinely unresolved.
Three further open questions
Whether any provider makes exceptions to a published ceiling through selected brokers, which we have not raised with them. How a down-valuation is handled where it pushes a case above a tier boundary after application, which none of the three publishes. And one provider publishes no rate we could verify, so its tier is in the ladder but not the cliff measurement.
Our methodology sets out the sources we use and their order of trust, and the change log records what moved and when.
Tell us what the published data could not answer
Everything above comes from what providers publish. Whether a provider will actually take you depends on affordability, credit history and the property itself, and on criteria nobody prints. Tell us what you are stuck on and we will come back to you.
The tiers above are the published entry points. Which one you actually land on is decided in underwriting.
Common questions
- What is the minimum deposit for an Islamic mortgage?
- The lowest published deposit across the mainstream UK providers we track is 5%, published by both Gatehouse Bank and Offa for UK residents. The conditions differ: Gatehouse attaches it to houses, on a purchase, with finance under £600,000. Most products sit at 10% or 20%.
- Is the deposit for an Islamic mortgage different from a normal mortgage?
- The amount works the same way. On the co-ownership plans covered here your deposit is your opening share of the property, rather than the part of the price a lender is not lending you.
- How much does a bigger deposit save?
- It depends which step you are on. In our current records, going from a 35% deposit to a 20% deposit changes the rate by 0.13 percentage points or less. Going from 20% to 10% costs 0.6 to 0.8 points and raises the product fee (£0 to £999 and £499 to £999). Going from 10% to 5% costs a further 0.1 to 0.3 points.
- Can you get an Islamic mortgage with a 5% deposit?
- Yes. Gatehouse Bank and Offa both publish 95% finance-to-value routes for UK residents, on different conditions. A gifted deposit, which StrideUp accepts in full, or buying below market value from family, where Gatehouse and Offa let the discount stand in for cash, can reduce what you personally need. Neither is a 100% finance product.
- Do expats need a bigger deposit?
- Yes, on published criteria. Both providers that publish expat and international tiers cap those at 80% finance-to-value, which is a 20% deposit, against 95% for UK residents.
Key takeaways
- The lowest published deposit is 5%, from 2 providers on different conditions. Gatehouse Bank and Offa, both UK residents only, with one attaching a property type, transaction type and a £600,000 finance ceiling.
- The 80% to 90% step is the largest measured jump. Crossing it costs 0.6 to 0.8 percentage points and raises the product fee. The steps either side cost 0.13 points or less, and 0.1 to 0.3 points.
- Your deposit is your opening share on the co-ownership plans covered here. It always reduces the provider share you pay rent on, and may also move you onto a lower rate tier.
- Expats and international buyers face a 20% floor on published mainstream criteria.
- A ceiling without its conditions is not usable. Every tier above carries the customer type, property type, transaction and finance band it belongs to.
Next: check which tiers your situation meets, or compare products at your tier.