SANTANDER has launched “My First Mortgage” with just a £10,000 deposit needed to get on the property ladder with brokers saying “it’s a very useful option”.
The new product is a 98% five-year fixed rate mortgage product, with a rate of 5.19%, zero product fee and £250 cashback.
“My First Mortgage” is available exclusively to first-time buyers and marks Santander’s latest step towards helping more would-be buyers onto the property ladder.
Data from the lender shows that more than half (52%) of UK adults said they found saving money for a deposit to be the biggest barrier to buying a property.
The new product requires a minimum £10,000 deposit, with maximum lending up to £500,000 repayable over a term of between five and 40 years.
Lending above 95% and up to 98% is available on existing houses only, with data from the lender showing that two thirds of first-time buyers purchased a house in 2025.
Santander said it was a maximum loan to income multiple of 4.45x salary.
Customers looking to purchase a new build property or flat are able to continue to access borrowing up to a maximum 95% Loan to Value (LTV).
This comes as NatWest and Nationwide now offer mortgages up to 6x salary.
Allow buyers to get on the ladder
David Morris, Head of Homes for Santander UK, said: “We know that saving for a deposit remains one of the biggest hurdles to homeownership. Last year, the average first-time buyer with Santander put down a deposit of more than £85,000, a figure that can feel unattainable for today’s aspiring homeowners, whether that’s a result of more modest income, limited family financial support, rising rental costs, and in some cases childcare expenses.
“We want to help more people benefit from the stability and sense of pride that owning a home brings, while maintaining our position as a responsible lender. My First Mortgage does just that, offering the chance to speed up the time to ownership with the reassurance that the buyer has received specialist mortgage advice and will have certainty of what they are expected to pay, every month, for the next five years.”
Brokers described the new product as “bold and significant” but did point out that the criteria are very strict to qualify for the deal.
Bold and significant
Shaun Sturgess, Director at Swansea-based Sturgess Mortgage Solutions, said: “Santander UK’s decision to launch a 98% LTV mortgage is a bold and significant move, especially as the first high street lender to go beyond the traditional 95% limit. In South Wales, where many first-time buyers are held back by deposit requirements rather than income, this could be genuinely helpful.
“Saving a large deposit remains one of the biggest obstacles to homeownership, and this product may allow some buyers to get on the ladder years earlier than they otherwise could. That said, borrowing at such a high loan-to-value level comes with clear risks.
“Buyers will start with very little equity, making them more vulnerable if property values fall or if their circumstances change. It also places greater importance on strong affordability and long-term financial planning. Overall, this is positive in terms of improving access to homeownership, but it also highlights how stretched the market remains.”
Michelle Lawson, Director at Lawson Financial, said she only found out about the product through the press.
She added: “This sounds like a great product although I’m disappointed to be reading this on a press release rather than being informed of it in my inbox after yesterday’s tease email came out. Good to see the high street banks helping first-time buyers.
“Although, caution should be applied and advice sought as new couples that break up and need to sell during the first five years would be hit with penalties which could be more than the deposit, so there is a financial risk.”
Combat generation rent
Riz Malik, Director at R3 Wealth, said lenders are attempting to “combat generation rent”.
He continued: “Great to see Santander thinking outside of the box to get Britain moving. With the government clearly not taking action, it is down to the lenders once again to help and take the lead and help to combat generation rent.”
Justin Moy, Managing Director at EHF Mortgages, pointed out you need income well over £100,000 a year to borrow the maximum £500,000.
He added: “Another new mortgage product to help first-time buyers onto the property ladder, in a similar fashion to products available via Accord Mortgages and Skipton BS.
“Without needing to save a considerable deposit, those looking to move home for the first time can do so without relying upon the Bank of Mum and Dad, although to make the loan 98% LTV, you will need an income well over £100k and borrow the maximum £500k available, which will be difficult for the vast majority. The larger the deposit, the more choices you will have as a borrower, but as a new opportunity for borrowers, it’s a very useful option.”
Samuel Mather-Holgate, Managing Director & IFA at Mather and Murray Financial, said Santander is helping first-time buyers onto the ladder.
He continued: “Saving for a deposit is the hardest thing for first-time buyers to do, and Santander add their name to a list of lenders who are looking to circumvent this problem. Many may be worried that we are returning to the bad old days of 120% loan-to-value mortgage and certifying your income on the back of a fag packet, but we are not.
“Affordability criteria is much more rigid now, and that was what got us into trouble in the housing market. Lenders are not worried about lending too much, but more who they are lending to. This means you will need a squeaky clean credit rating to be approved for these products, but they will help enormously if you are eligible.”
Gratefully received
Ranald Mitchell, Director at Charwin Mortgages, said the product was practical.
He added: “This 98% deal could be the ‘deposit breaker’ first-time buyers have been crying out for and it will be gratefully received. So many first-time buyers aren’t short of willingness, they’re stuck in the ‘high rent, can’t save’ trap where the monthly cost of buying can be doable, but the deposit target feels impossible.
“A 98% five-year fix with no fee and cashback is exactly the kind of practical product that can turn renters into owners and when a top high street bank does it, it forces the rest of the market to sit up and compete for first-time buyers again.”
Richard Davidson, Mortgage Advisor at onlinemortgageadvisor.co.uk, said it was “fantastic news”.
He continued: “Santander’s launch of 98% mortgages for first-time buyers is fantastic news for the market. It shows real confidence in the future direction and demonstrates that lenders are more relaxed about affordability and clients’ ability to pay. “
This will have been carefully thought through because Santander are not a lender to take rash decisions, and they will have certainly identified significant demand for a product like this to help people escape the rent cycle where saving for a deposit has become impossible due to high rents and lower disposable income.”
Very strict criteria
Jack Tutton, Director at SJ Mortgages, pointed out that the product is not available to self-employed customers.
He said: “Santander becoming the first ‘high street’ lender to offer mortgages with less than a 5% deposit will be welcome news to first time buyers, lenders offering alternative products to help potential buyers is always a positive.
“However, the product not being available to self-employed customers will not help the stigma that lenders don’t like lending to people who are self-employed.”
David Stirling, Independent Financial Adviser at Mint Wealth Ltd, also said there was “very strict criteria to qualify”.
He added: “Santander have released a headline-grabbing new product, but look under the bonnet and there are very strict criteria to qualify, so this won’t be a panacea for the general first-time buyer market. It is disappointing that it also won’t apply to properties in Northern Ireland and the self-employed are still restricted to 90%.
“As with all high LTV products, borrowers should be aware of being on the teetering edge of possible negative equity from the outset and the fact they will be paying a premium rate means their equity on the property will build much more slowly.”
