How much deposit do you need for an Islamic mortgage?
The lowest published deposit across the mainstream UK providers we track is 5%, published by Gatehouse Bank and Offa. The conditions differ, and they matter: one attaches a property type, a transaction type and a finance ceiling to it. Most products sit at 10% or 20%, and the step between those two carries almost the whole cost of the ladder. Once you know the tiers, the deposit optimiser tests your own figures against them and shows what crossing the next one is actually worth.
The short answer
Deposit is expressed the other way round in provider documents. They 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 on this page is stated both ways so the two never get mixed up.
There is no single answer because the ceiling moves with who you are, what you are buying, and how much you need. A 5% deposit is published by two providers, on different conditions. Read those conditions rather than the headline, because one of them narrows it to a single property type, transaction type and finance band.
Maximum finance-to-value rules, and the deposits they imply
11 published ceilings across the three mainstream providers. These are eligibility rules: they answer whether you can reach a given finance-to-value at all. They are not the same thing as the pricing bands analysed further down, which answer what happens to the rate as the tier changes. The conditions column is the point: 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, purchase, finance up to £600,000 |
| Gatehouse Bank | 10% | 90% | UK residents, finance up to £750,000 |
| Gatehouse Bank | 20% | 80% | UK residents, finance up to £2,000,000 |
| Gatehouse Bank | 20% | 80% | British expats and international residents |
| Gatehouse Bank | 25% | 75% | UK residents, finance up to £3,000,000 |
| Gatehouse Bank | 30% | 70% | UK 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 links to its record on our comparison page. Criteria change without notice.
The 80% cliff, measured
The deposit ladder is not linear. Across every like-for-like pair we hold, saving from a 35% deposit down to 20% changes the rate barely at all, and going from 10% to 5% costs 0.3 points. One step carries almost the whole cost: moving from a 20% deposit to a 10% deposit costs 0.7 to 0.8 percentage points and the product fee rises, £499 to £999. That holds across 2 providers and 6 like-for-like pairs. A pair only counts when the two products share a provider, product range, rate type and fixed period, and when at least one customer on one transaction type could actually choose between them.
| Step | Deposit | Rate change | Product fee | Pairs measured |
|---|---|---|---|---|
| 65% to 80% finance | 35% to 20% | +0 to +0.13 | unchanged | 7 |
| 80% to 90% finance | 20% to 10% | +0.7 to +0.8 | £499 to £999 | 6 |
| 90% to 95% finance | 10% to 5% | +0.3 | unchanged | 6 |
| Provider | Product | 20% deposit | 10% deposit | Difference | Product fee |
|---|---|---|---|---|---|
| Gatehouse Bank | 2 years fixed | 5.58% | 6.38% | +0.8 | £499 to £999 |
| Gatehouse Bank | 5 years fixed | 5.66% | 6.36% | +0.7 | £499 to £999 |
| Gatehouse Bank | 2 years fixed | 5.68% | 6.48% | +0.8 | £499 to £999 |
| Gatehouse Bank | 5 years fixed | 5.76% | 6.46% | +0.7 | £499 to £999 |
| Offa | 2 years fixed | 5.80% | 6.60% | +0.8 | £499 to £999 |
| Offa | 5 years fixed | 5.88% | 6.58% | +0.7 | £499 to £999 |
What this means in pounds
On a £250,000 home, the difference between a 20% and a 10% deposit is £25,000 of cash. Finding it moves you off the higher tier, which on these records is worth 0.7 to 0.8 percentage points on the rate plus the fee difference. Our calculator prices both on your own figures rather than this illustration.
In our normalised benchmark, moving between the 80% and 90% tiers changes pricing by more than moving between Gatehouse and Offa at the same tier does. That is what we measured. It is not a general claim about the market.
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, not the portion of the price a lender declined to lend. 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 opening share, and therefore the amount rent is calculated on. Separately, it may move you onto a lower rental-rate tier. Those are two different effects, and the second is not guaranteed: on our records the step from a 35% deposit to a 20% one changes the rate 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. Separating them is the difference between a useful answer and a misleading one.
- Gifted cash
- Someone else provides the deposit. There is still a deposit, and it is still the same percentage. StrideUp's intermediary criteria state that a 100% gifted deposit is acceptable, from any number of sources, and that gifts from outside close family can be considered. Source, read .
- Gifted equity, buying from family below market value
- No cash deposit from you at all, because the discount from market value stands in for it. Gatehouse announced on that it removed the minimum personal-funds deposit for these cases, up to 75% finance-to-value: on its worked example a £300,000 home bought from parents for £225,000 is financed in full, with the £75,000 difference treated as gifted equity. Applications remain subject to a surveyor confirming market value, and affordability is assessed independently. Source. Offa publishes a comparable route, stating that buying below market value from family lets you use the full value for finance with no deposit needed. Source, both read .
- What none of this is
- A 100% finance product. In a discounted family purchase the equity is still there; it arrives as a discount rather than as cash from you, and Gatehouse caps the finance at 75% of full market value precisely because of that. Nobody in this market publishes finance on a property at its full price with nothing behind it.
Provider announcements and criteria pages, read . Criteria change without notice.
Expats and international buyers
Among the mainstream propositions on this page, the published non-UK routes we track top out at 80% finance-to-value, implying at least a 20% deposit. Gatehouse states up to 80% for UK expats and international residents; Offa's 90% and 95% products are UK-resident only, and its expat range tops out at 80%.
Specialist providers exist for non-UK residents and publish their own ceilings, generally lower again. Those propositions sit outside our comparison and are listed with their customer scope on the provider register.
What we could not verify
StrideUp publishes two different ceilings for a standard property. Its consumer eligibility page states 90% finance-to-value, a 10% deposit. Its intermediary criteria state 85% at the relevant finance band, a 15% deposit. We have not established whether that is a difference in policy by application route or inconsistent public documentation, and we are not going to decide it by assumption. We hold both figures and check against both: a deposit that clears the lower one is fine either way, a deposit between them is genuinely unresolved.
Three further things. First, whether any provider makes exceptions to a published ceiling through selected brokers, which we have not raised with them. Second, how a down-valuation is handled where it pushes a case above a tier boundary after application, which none of the three publishes. Third, one provider publishes no rate we could verify, so its tier appears in the ladder above but not in 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. What differs is what it buys 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. Not every Islamic home finance structure works that way, and some do not involve the provider owning the property at all.
- 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 0.7 to 0.8 points and doubles the product fee from £499 to £999. Going from 10% to 5% costs a further 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, though the conditions differ. Two separate things can reduce the cash you personally need below that: a deposit gifted by someone else, which StrideUp accepts in full, and buying below market value from family, where Gatehouse and Offa let the discount stand in for a cash deposit. 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 0.7 to 0.8 percentage points and doubles the product fee. The steps either side cost 0.13 points or less, and 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.