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Service Status: The current lockdown means our branch opening hours have changed. Please check our branch locator if you need to visit for the latest information.
The safest way to bank with us right now is from home either using our app or through Internet Banking.
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Loan to value – or LTV – is the ratio of the value of the home you want to buy and the loan you’ll need to buy it, shown as a percentage.
Having a good LTV can lower the interest rates offered to you and mean you have more equity in your home.
A higher LTV is a greater risk to lenders if the property market drops. This is because your existing mortgage could exceed the value of your home, resulting in a loss for the lender and puts you in a negative equity position.
Find out how to work out your loan to value ratio and what LTV means for your mortgage with this guide.
The easiest way to work out your loan to value ratio is to take away your deposit amount from the value of the house, then work out the difference as a percentage.
For example, if your house is valued at £250,000 and you have a deposit of £50,000, you would need a mortgage of £200,000.
To calculate your LTV ratio:
200,000 ÷ 250,000 = 0.8
0.8 x 100 = 80%
This gives you an 80% loan to value ratio.
The larger your deposit, the lower your LTV. Think about how much you can afford upfront before applying for a mortgage.
To work out your Loan to Value ratio and see how much you could borrow, use our handy mortgage calculator.
It’s simple to use – enter your:
You can also use this tool to get an estimate of your monthly repayments.
The best way to raise your LTV ratio is to put down a bigger deposit on your home. This may mean waiting to buy a home until you can save a bit more money.
Other ways to get a lower LTV ratio include:
Finding a house with a lower asking price will reduce your LTV. This could be fewer bedrooms or looking in an area where house prices are lower.
If you’re a first time buyer or wanting to own a share of the home, you could benefit from the government’s Shared Ownership schemes.
The content on this page is for reference and does not constitute finance advice.
For impartial financial advice, we recommend government bodies like the Money Advice Service.
Find out more about mortgages.
We have a range of mortgage calculators to help you:
You can talk to us over the phone or use our mortgage video service from the comfort of your own home.
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