What is loan to value?

Loan to value (LTV) is the percentage of a property’s value that you borrow from the mortgage lender, compared to its total value. So for example, if you borrow £100,000 towards a £120,000 property, that’s 80% of the total property value, or 80% LTV. 

The other 20% would be made up by your deposit. So the LTV of your mortgage depends on how much deposit you have.

Looking for a mortgage? Let us help:

  • Speak to an expert today about your needs and the current market

  • Clear mortgage recommendations with access to 70 lenders online mortgage broker exclusive products

  • We've helped 1,000s of people find their best deal


Ready to be clear about your mortgage options?

Mojo Mortgages is an award-winning online mortgage broker. Let's get you the best rate you can... for free, all from the comfort of your sofa.

MAP phone

Going above & beyond to save you time ⏳ & money 💰 on your mortgage

Paperwork help ✅ Mortgage broker exclusives ✅ Works alongside nearly every lender ✅

1. Add your details online

No 2-hr phone calls or branch visits. It takes a few minutes to tell us what you need from your next mortgage online

2. Choose how & when to speak to your broker

ASAP? Or choose the perfect time - 6 days a week and evenings

3. Get your mortgage with Mojo

We’ll check and chase to help avoid delays. Get regular updates from your broker and case manager

How does LTV affect interest rates?

The more you borrow, the more risky the lender takes on, so they charge higher interest rates to balance out that risk.

This means that those who invest more towards their own property, with a higher deposit - and therefore a lower LTV, will be seen as lower risk. Their reward for this investment is lower interest rates. 

Why mortgage lenders care about LTV

Although it’s unusual, if the lender had to repossess your home, they’d want to know that they could get their money back on their investment when they sold it. 

If the lender is unable to sell your property for the same amount of money they lend you for it, they’ll make a loss. So lenders use higher interest payments as a buffer to prevent them losing too much money, should house prices have fallen if they’re in a position to need to repossess your home.

How do I work out my LTV?

It’s a simple calculation: 

How much you’re borrowing (or current mortgage balance for remortgage) / current property value x 100

What’s the maximum LTV mortgage you can get?

Usually 95% LTV, although it’s possible to get 100% LTV mortgages in certain circumstances. 

They are not as readily available as they once were, but some lenders offer guarantor and family assisted mortgage products that enable you to borrow 100% of the mortgage loan. There is also a 100% mortgage available from Skipton Building Society that’s aimed at renters looking to get onto the property ladder. 

In most cases, however, the maximum LTV is 95%, meaning you’d need at least 5% deposit to be accepted.

What’s the lowest LTV mortgage available?

There is no lowest LTV, although most lenders have a minimum loan size, so if your LTV is so low that you need to borrow less than that, you may not get a mortgage. 

Generally speaking, however, the lower your LTV, the better the interest rate you’ll get. The best rates on the market tend to kick in at 60% LTV, meaning you’d need a 40% deposit to access them.

What are the different LTV thresholds for mortgages?

Interest rates are offered based on the LTV, and LTV bands are in 5% increments. So, for example, 95% 90%, 85% and so on. If your deposit or equity takes your borrowing into the next LTV band down, this usually gives you access to better rates. 

Usually the thresholds are 100%, 95%, 90%, 85%, 80%, 75%, 70%, 65% and 60% LTV, but not all lenders offer loans at each of those levels. 

Equally, some lenders have wider LTV thresholds than others, so deals between 80% and 95% LTV could potentially have the same interest rates, and you’d only save money if your loan was reduced to 75% LTV. 

What’s a good LTV for a mortgage?

Getting your LTV as low as possible generally gives you the most choice of deals and access to better rates. 

Lenders each have their own idea and appetites towards risk, but largely, 85-100%LTV is considered high, 70-80% LTV is mid-range and 65% or lower is considered as low LTV borrowing. 

However, you typically get access to significantly more deals at around 75% LTV, so when you have a 25% deposit.

Our Mortgage Matcher can show you what your monthly repayments could look like at various LTVs. Try entering different deposit amounts and property values to see what could be available to you. Click here and choose ‘new mortgage’ or ‘remortgage’ to begin.

What is a good LTV to remortgage? 

Remortgaging is slightly different, as in most cases you won’t provide an additional cash deposit. The LTV still matters, and determines the rates you’re offered, but your equity is used in place of a deposit. 

What LTV are buy-to-let mortgages offered at?

Most buy-to-let lenders require at least 25% deposit, as they typically lend at a maximum of 75% LTV. That said, it’s possible to find them at up to 85% LTV in some cases. It’s also sometimes possible to offer your existing properties as security, especially if you’re a portfolio landlord.