What is LTV in a Mortgage?

What is LTV? Loan to value (LTV) is the size of your mortgage as a percentage of the property value. Work out LTV & your mortgage options.

Written by John Cullen
Updated over a week ago

Loan-to-Value (LTV) is the size of your mortgage as a percentage of the total property value.

The higher your deposit, the lower your LTV. If you put down a 10% deposit on your home, that’s a 90% mortgage, or 90% LTV.

A lower LTV usually means lower initial interest rates. That’s because a bigger deposit means less risk for lenders.

You can find our initial interest rates here.

A little math

Say you want to buy a property worth £250,000. You have a deposit of £25,000, so you need to take out a mortgage of £225,000. That makes your LTV: 225,000 divided by 250,000 = 0.90 x 100 = 90% LTV

I have a high income, why can't I borrow more?

As you may know, the income you receive makes a big difference to the amount you can borrow and adding an Income Booster can often stretch this even further.

However, dependent on the amount of deposit you are willing to put down, this can limit the size of the mortgage you can get.

For example

If you were looking to purchase a property and have a total deposit of £10,000. Whilst your income may allow you to borrow much more, the maximum we could look to lend would be £190,000 and this is because we are unable to lend more than 95% of the property value (95% LTV).

Please note, the amount we could look to lend and the maximum LTV would depend on a number of factors and would be subject to a full application.

Our current products and LTVs can be seen here.

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