Calculate the deposit, loan-to-value and remortgage equity you have; record where the money comes from; and keep the other costs of buying outside the deposit figure. There is no universal deposit percentage that guarantees an adverse-credit mortgage.
How much deposit is needed for a bad credit mortgage?
The amount cannot be answered from the words “bad credit” alone. A lender considers the requested loan-to-value together with the credit events, affordability, property, purpose and source of funds. Calculate your own figures first, then check them against current lender criteria for the full case.
Calculate your deposit and loan-to-value
Use the same purchase price or value and mortgage figure throughout. The calculation describes the case; it does not show that a lender will accept it.
purchase price − mortgage requiredThis is the part of the price being met without the main mortgage.
cash deposit ÷ purchase price × 100Use this to express your contribution as a percentage.
mortgage required ÷ purchase price or value × 100A lower LTV means the mortgage covers a smaller share of the property.
A simple purchase example
For a £250,000 purchase with a £212,500 mortgage, the cash deposit is £37,500. That is a 15% deposit and an 85% LTV.
Prefer a calculator? Use Count Ready’s mortgage deposit calculator (opens in a new tab) and keep the inputs with your case notes.
Why there is no standard bad credit deposit
Competitor guides often quote a fixed range. That shortcut can be misleading because two applicants with the same deposit can receive different outcomes.
The credit events
Lenders may distinguish between missed payments, defaults, CCJs, arrangements, IVAs, bankruptcy and repossession. The date, amount, status, frequency and explanation can all matter.
Affordability
A deposit does not prove that the monthly mortgage is affordable. Income, committed expenditure, household costs, dependants, the term and potential rate changes remain part of the assessment.
The property and purpose
The property type, condition, tenure, valuation and whether the case is a purchase, home move or remortgage can affect which criteria apply.
Deposit source
Savings, sale proceeds, equity, gifts and other sources can require different evidence. A lender and conveyancer may also ask how the money was built up or transferred.
Income evidence
Employment, variable pay, self-employment and company income can be assessed in different ways. The deposit cannot fill a gap between the income evidenced and the loan requested.
Current lender rules
Product availability and criteria can change. A useful answer must be dated and based on the applicant, property and transaction being considered.
Keep the deposit separate from the rest of your cash budget
A deposit calculation can be correct while the transaction is still underfunded. List the other costs before deciding how much cash to commit.
| Budget line | What to record | Question to resolve |
|---|---|---|
| Mortgage deposit | Cash contribution and calculated percentage. | Is the stated source acceptable and fully evidenced? |
| Mortgage and advice fees | Amount, payee, due date and refund position. | Must the fee be paid in cash, or may it be added to the loan? |
| Legal work and searches | Quote, disbursements and work outside the standard scope. | Does the quote cover the property, ownership and funding arrangement? |
| Valuation and survey | Lender valuation and any separate survey you choose. | Which cost is yours, and when could it become non-refundable? |
| Property tax | The relevant tax for England or Northern Ireland, Scotland or Wales. | Have you used current rules for your location and buyer status? |
| Moving and initial costs | Removals, insurance, urgent work and essential purchases. | What must be paid before or immediately after completion? |
| Cash remaining | The amount left after every known completion cost. | Does the household retain a practical margin for bills and unexpected costs? |
Prepare the source-of-funds trail
“The money is in my account” does not always explain where it came from. Record the origin and the transfers so that questions can be answered early.
State the original source
Examples include regular savings, sale proceeds, a family gift, inheritance, a bonus or the sale of an investment. Name every source if the deposit is mixed.
Keep an audit trail
Retain the statements or documents that show the money arriving and moving between accounts. Avoid unexplained cash movements or last-minute transfers where possible.
Disclose obligations
If any money must be repaid, gives another person an interest in the property or came from new borrowing, explain that before an application is submitted.
A gift needs more than a transfer
Gifted money can form part or all of a deposit in some cases, but the arrangement and evidence must meet the lender’s and conveyancer’s requirements.
Questions about the donor
- Who is giving the money and what is their relationship to you?
- How did the donor obtain the funds?
- Will the donor live at the property or expect any ownership?
- Can both sides provide identification and a clear bank trail?
Questions about the arrangement
- Is the money an outright gift, a loan or another family arrangement?
- Is repayment expected now or later?
- Will anyone take a charge, restriction or beneficial interest?
- Has the gift been disclosed before the lender and solicitor complete checks?
Use equity instead of a purchase deposit
A remortgage customer usually measures the value left in the property after secured borrowing, then calculates the LTV of the new mortgage required.
current value − secured borrowingInclude all borrowing secured on the property when building the case.
redemption amount + extra borrowing + allowed additionsUse current redemption figures and identify the purpose of any extra funds.
new mortgage required ÷ current value × 100The lender’s own valuation may differ from an estate-agent estimate.
A simple remortgage example
If a property is estimated at £300,000 and the mortgage balance is £225,000, the estimated equity is £75,000 and the starting LTV is 75%. If the new mortgage required rises to £240,000, the LTV becomes 80% before any lender-specific treatment of fees or valuation.
Apply the deposit work to your mortgage route
The formulas stay the same, but the documents and practical questions change.
First-time buyer
Separate the deposit from legal work, tax, survey and moving costs. Record whether family help is a gift, loan or ownership arrangement before applying.
First-time buyer guidance (opens in a new tab)Home mover
Use expected sale proceeds after repaying the current mortgage and selling costs. Test the budget if the sale price, purchase price or completion timing changes.
Remortgage customer
Obtain a current balance or redemption statement, estimate the property value and show any extra borrowing separately. Recalculate if the lender’s valuation differs.
Remortgage guidance (opens in a new tab)Self-employed applicant
Keep deposit evidence separate from business and personal income evidence. Explain transfers from a company or business account before treating them as available cash.
Self-employed guidance (opens in a new tab)Record the figures before asking for a deposit assessment
This short record gives an adviser enough context to identify the questions that need checking. It is not an application or lending decision.
How this guide was checked
The calculations and safeguards were checked against current official consumer guidance, FCA mortgage rules and legal-sector anti-money-laundering guidance.
MoneyHelper: deposits and LTV
The government-backed service explains deposits, loan-to-value and the general relationship between a larger deposit and product choice. Open MoneyHelper’s deposit explanation (opens in a new tab).
MoneyHelper: buying costs
Its home-buying guide separates the deposit from mortgage, legal, survey, moving and property-tax costs. Open MoneyHelper’s home-buying costs overview (opens in a new tab).
MoneyHelper: remortgage LTV
Its remortgage guidance gives the LTV calculation and explains that the lender uses a current property valuation. Open MoneyHelper’s remortgage LTV instructions (opens in a new tab).
FCA responsible lending
MCOB 11.6 requires an affordability assessment for regulated mortgages and says it must not be based on the equity used as security. Read MCOB 11.6 (opens in a new tab).
Law Society AML guidance
Legal-sector guidance explains why source of funds and source of wealth are considered in risk-based client checks, including conveyancing. Read the AML guidance (opens in a new tab).
What remains case-specific
Lender deposit criteria, acceptable donors, evidence, valuation and product availability can change. Current personalised information takes priority over this general planning guide.
Information and source links reviewed 19 September 2026.
Ask Count Ready to review your deposit or equity position
Tell us whether you are buying, moving or remortgaging, the price or estimated value, mortgage required, deposit or equity available, broad source of funds and the type and date of the credit issue. We can then explain which facts need checking before an application.
At first contact, do not attach bank account details, online-banking access, identification documents or a full credit report. An adviser can agree a suitable way to provide any documents needed later.
Bad credit mortgage deposits
What deposit do I need for a bad credit mortgage?
There is no single deposit percentage for every adverse-credit application. The lender will consider the loan-to-value, the type, amount, status and age of the credit events, affordability, the property and the source of the deposit. Work out the cash or equity available, then obtain a current assessment for your circumstances before committing to a purchase.
Will a bigger deposit guarantee approval if I have bad credit?
No. A larger deposit reduces the amount borrowed and the loan-to-value, which may change the products that can be considered. It does not remove credit events or replace the lender’s checks on affordability, income, expenditure, property and application information.
Can I use a gifted deposit with bad credit?
A gifted deposit may be acceptable, but the lender and conveyancer will need to understand who is providing it, where the money came from and whether it is a genuine gift with no repayment or ownership expectation. Acceptance and evidence requirements vary, so disclose the arrangement before applying.
Can I borrow my mortgage deposit on a loan or credit card?
Do not assume borrowed deposit money will be accepted. Any loan, credit-card balance or family repayment arrangement must be disclosed because it can affect affordability and lender criteria. Ask an adviser to check the proposed source before taking new credit or making an application.
Can a larger deposit reduce a bad credit mortgage rate?
A larger deposit creates a lower loan-to-value and can affect the range and pricing of products available, but the outcome also depends on the credit events and the rest of the case. Compare current personalised illustrations, fees and the remaining balance rather than treating deposit size as a promised rate.
How do I work out my equity when remortgaging with bad credit?
Start with a realistic current property value and subtract the mortgage balance and any other borrowing secured on the property. Divide the total mortgage required by the value and multiply by 100 to estimate the loan-to-value. The lender will use its own valuation and current figures when assessing the application.
Should I use all my savings as the mortgage deposit?
Consider the deposit alongside legal work, mortgage fees, a survey, property tax where applicable, moving costs and the money you need after completion. Keeping a sensible margin can be more practical than using every pound, but the right balance depends on your budget and the current mortgage options available.
Continue with the right specialist guide
General information only, not personal financial or legal advice. Count Ready is a broker, not a lender. Deposit size, a discussion, agreement in principle or application does not guarantee a mortgage offer. Your home may be repossessed if you do not keep up repayments on your mortgage.