What Deposit Do I Need to Buy a Property in Glasgow, Edinburgh or London?

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One of the Biggest Barriers for Home Buyers  Explained Clearly

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One of the very first questions most buyers ask is:

“What deposit do I need to buy a property in Glasgow, Edinburgh or London?”

It’s also one of the most misunderstood parts of the home-buying process.

You’ll often see simple answers online like “You only need 5%”  but in reality, the deposit you actually need can vary significantly depending on:

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• Where you’re buying
• Which lender you use
• Your income and credit profile
• How competitive the local market is

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This guide explains everything clearly, in plain English, so you know exactly what to expect  and how Pelican Finance Limited can help you prepare properly and avoid costly surprises.

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What Is a Mortgage Deposit?

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A mortgage deposit is the amount of money you contribute towards the purchase of a property upfront.
The remaining amount is borrowed from a mortgage lender.

Most lenders describe this using loan-to-value (LTV) percentages:

• A 95% mortgage means you provide a 5% deposit
• A 90% mortgage means you provide a 10% deposit
• A 85% mortgage means you provide a 15% deposit

While some lenders advertise low-deposit mortgages, the minimum deposit is not always the realistic deposit once local market factors are considered.

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Minimum Deposit Requirements – What Buyers Usually Need

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Deposit Requirements in Scotland (Glasgow & Edinburgh)

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In Scotland, many buyers can technically purchase with a 5% to 10% deposit, but this often depends on how competitive the property market is.

Key things buyers need to understand:

• Properties are marketed using a Home Report value
• Many properties sell for more than the Home Report value
• Lenders will only lend based on the Home Report valuation

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This means:

• Any amount paid over the Home Report value must usually be covered entirely by your own funds, on top of your deposit

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For example:

• Home Report value: £200,000
• Accepted offer: £215,000
• Mortgage based on £200,000
• Extra £15,000 required from your own savings

This is one of the biggest deposit surprises for Scottish buyers.

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Deposit Requirements in London

London typically requires larger deposits, even for buyers with good incomes.

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Common reasons include:

• Higher property prices
• Stricter lender affordability stress testing
• Increased risk assessment by lenders

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In practice, many London buyers need:

• 10% to 15% deposit
• Sometimes more for flats, new builds, or high-value properties

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Even buyers who technically qualify for a 5% mortgage may find that:

• Monthly payments become unaffordable under lender stress tests
• A larger deposit improves approval chances and rates

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Pelican Finance Limited Focuses on Real-World Deposits Not Just Minimums

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Rather than quoting headline figures, Pelican Finance Limited helps buyers understand:

• What deposit lenders will actually accept
• Whether your target area requires extra funds
• How much flexibility you really have

This avoids disappointment, failed applications, and wasted time.

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Hidden Deposit Pain Points Buyers Often Miss

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Offers Over (Scotland)

In competitive Scottish markets, especially in Glasgow and Edinburgh, properties frequently sell above valuation.

Important points to remember:

• Lenders will not fund offers over value
• Buyers must cover the difference themselves
• This can add thousands to the deposit required

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Valuation Gaps

Even outside Scotland, lenders base lending decisions on their own valuation, not the agreed purchase price.

If a valuation comes in lower than expected:

• You may need to increase your deposit
• Or renegotiate the purchase price
• Or change lender strategy

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Gifted Deposits

Gifted deposits are common but they must be handled correctly.

Lenders typically require:

• A signed gifted deposit declaration
• Confirmation the funds are non-repayable
• Evidence of where the funds originated

Incorrect documentation can delay or derail an application.

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Can I Buy with a 5% Deposit?

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Yes buying with a 5% deposit is possible for many buyers.

However, it usually comes with trade-offs:

• Fewer lenders to choose from
• Higher interest rates
• Stricter credit score requirements
• Less flexibility if valuations change

This is where broker advice is crucial.

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Pelican Finance Limited helps you decide whether:

• Buying now with 5% is sensible
• Waiting to save a larger deposit improves outcomes
• A different lender strategy reduces long-term costs

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Deposit Sources Lenders Commonly Accept

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Most lenders are comfortable with deposits coming from:

• Personal savings
• Gifted deposits from parents or close family
• Equity released from another property
• Proceeds from the sale of an existing home

Each source has its own documentation requirements, which Pelican Finance manages to avoid delays.

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Scotland vs London: Deposit Reality in Plain Terms

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Buying in Glasgow

• Deposits often start at 5%
• Competitive markets mean offers over are common
• Extra funds are frequently required

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Buying in Edinburgh

• Deposits often closer to 10% or more
• High demand increases competition
• Valuation gaps are common

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Buying in London

• Deposits usually 10–15%
• Affordability testing is stricter
• Higher deposits improve approval chances

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How Pelican Finance Limited Helps You Buy Sooner

Pelican Finance Limited supports buyers by:

• Identifying lenders with lower deposit thresholds
• Advising when waiting and saving makes financial sense
• Structuring gifted deposits correctly
• Avoiding failed applications and unnecessary credit searches
• Providing honest, clear advice at every stage

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The goal is not just to get a mortgage but to get the right mortgage.

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FAQs – Mortgage Deposits

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What deposit do I need to buy a property in Scotland?

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Most buyers need between 5% and 10%, but competitive markets may require additional funds for offers over valuation.

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Is London more expensive when it comes to deposits?

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Yes. London buyers often need larger deposits due to higher prices and stricter affordability rules.

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Can my parents help with a deposit?

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Yes. Gifted deposits are common, provided the paperwork is completed correctly.

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Can Pelican Finance help me calculate my deposit?

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Absolutely. Pelican Finance Limited provides tailored advice based on your income, location, and long-term goals.

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