Woman who bought house with zero deposit mortgage describes how process really works

For most young people, getting on the property ladder seems like an impossible task. With sky-high rents, single incomes, student finance debts and a partial social life to maintain, the prospect of gathering up enough funds for a deposit on a home feels unobtainable.

But one woman has shared exactly how she did it - and all with a 0 percent deposit. Danielle Dixon Riley, who posts on TikTok, has a clear message for those people facing those same struggles and who are ‘desperate’ to get onto the property ladder.

Typically in the UK, home buyers need a deposit which more commonly range from 5 percent to 20 percent of the property's purchase price, with 5 percent often being the standard minimum requirement. Higher deposits also offer low interest rates.

But for those who weren’t able to stash money away in a lifetime ISA or Help to Buy scheme, there may still be some hope.

TikTok user @danielledixonrile told of how she used something called a Track Record Mortgage to finally get the keys to her own home. She used Skipton Building Society’s offer and was able to show she could afford the repayments based on her rent.

“If you are currently renting in the UK and are desperate to get on the property ladder but finding it impossible to save for a deposit, I really, really hope this video finds you” she said.

“We are about to complete our first house as first time buyers on a 0 percent deposit and I'm gonna tell you how we did that.

“So we are doing something called a track record mortgage with Skipton Building Society. This is a scheme that they offer for first time buyers to help you get on the property ladder.

“Now they understand that if you are renting a property in the UK, it is so difficult, if not impossible, to save enough money for a deposit. But they know that because you rent, you can afford to have a house - but you just can't afford to save for the deposit.”

According to the Skipton Building Society, those aged over 21 who are renting and haven’t owned a property in the last three years are eligible. It uses someone’s track record on renting to work out what they may then be able to borrow.

Deposits of less than 5 per cent will be accepted, and applicants don’t actually need a deposit to apply for the mortgage, which also offers an interest rate fixed for 5 years.

Danielle continued: “Basically they look at how much rent you are paying and what you can afford to pay and they will lend you an amount and 100 percent mortgage to the amount that you can afford.

“So say your rent payments are £700 a month, they will lend you enough money for a house. That would mean that your mortgage payments are £700 a month, because they know that that is something you can afford.

“Six months ago, I didn't even know this was a thing. Fast forward to now, we're about to complete our first house. And it all happened so quickly.

“You can literally go online now and do it and, like, by the end of today, you can be looking for houses. It's wild how quickly it can all turn around.”

After having the mortgage in principle accepted, she said she then began looking at homes within budget. It’s obviously not all plain sailing - and lenders still have to look at circumstances.

She added: “You can go searching, you can go looking, and when you find a house within that price range, you can put your offer in. When it gets accepted, you then ring Skipton and they will book you in.

“Then it’s a mortgage application appointment. Now, this appointment is obviously a little bit more grueling. They go through everything with you. They wanna know everything about your history, what you do for a living, you know, all the details. And then there's a bit of a waiting game.

“I really hope this video finds someone. Like me that was in this position 6 months ago, thinking, how the hell am I ever, ever gonna be able to save enough money for a deposit on a house?

“And now we are literally buying our first home.”

How track record mortgages work according to property expert

Jen Lloyd, Head of Mortgage Products and Propositions at Skipton Building Society told LadBible: “Track Record was designed for people who have consistently demonstrated they can manage regular housing payments through renting but may have struggled to save for a traditional deposit.

“The mortgage allows eligible customers to buy a home with up to 100 percent loan-to-value, meaning they may not need a deposit. Rather than focusing solely on whether someone has managed to build up savings for a deposit, it recognises the financial discipline many renters already show every month through paying their rent.

“This can help open the door to homeownership for people who may otherwise feel locked out of the property ladder.”

Jen said that applicants need to be 21 and over and need to be able to clearly evidence at least 12 consecutive months of rent payments within the last 18 months.

Ms Lloyd added: "This year marks three years since the launch of the mortgage, and we're incredibly proud of the impact it's had. Since launch, it has helped more than a thousand renters take their first step into homeownership, with many purchasing a home without a deposit.

"Importantly, more than half are now paying less on their mortgage each month than they previously did in rent. It's a powerful example of how innovation can help remove barriers and support more people in having a place to call home."