Considering their risky nature to lenders, it's no surprise that low deposit mortgages are becoming harder and harder to find. Banks have been stung by the sub-prime mortgage crisis, and are largely unwilling to take such risky loans into their loan books.
That being said, there are still plenty of financial institutions willing to take a punt on a low deposit, or even no deposit mortgage. The main thing to realise though, is that you'll have to make it worth their while.
To secure a low deposit mortgage, you'll have to prove a number of things to the bank to offset the higher risk. You will have to show them you have a good, stable income (it will often have to be higher than for borrowers who pay a deposit). You will have to demonstrate at least some genuine savings. And finally, you'll likely have to pay a higher rate of interest on the loan than your average lender.
Low Deposit mortgages are perfect for first-time buyers, but the big question now is - Where can you get one? If you point your browser in the direction of http://www.moneysupermarket.com/mortgages/ and click on their Low Deposit tab, you'll find a plethora of options.
To give an example, HSBC offer 85% loans at an initial rate of 2.99% for the first two years, rising to 3.9% after that. This is an excellent rate for first time buyers, or those looking to get back in the property market.