What is loan-to-value (LTV)?

Loan-to-value (LTV) is the ratio of your mortgage amount to the property value, expressed as a percentage. For example, if you buy a GBP 300,000 property with a GBP 240,000 mortgage, your LTV is 80%. The remaining 20% is your deposit.

How does LTV affect my mortgage rate?

Lenders offer better interest rates at lower LTV bands. The best rates are typically available at 60% LTV or below. Each band (60%, 75%, 80%, 85%, 90%, 95%) usually sees a rate increase. The difference between a 60% and 90% LTV mortgage can be 0.5-1.5 percentage points in interest rate.

What is a good LTV for a mortgage?

An LTV of 80% or below (meaning a 20% deposit or more) gives you access to a wide range of competitive mortgage products. Below 60% LTV gets you the very best rates. First-time buyers often start at 90-95% LTV, which still has options but at higher rates.

Can I get a mortgage with over 90% LTV?

Some lenders offer 95% LTV mortgages, particularly through the UK government-backed mortgage guarantee scheme. However, options above 95% LTV are extremely limited. A higher deposit reduces your LTV, improves your rate, and lowers your monthly payments.

Does LTV change over time?

Yes, your LTV decreases as you repay your mortgage and if your property increases in value. When remortgaging, a lower LTV due to equity growth can qualify you for better rates, even if your original deposit was small.

Loan-to-Value (LTV) Calculator

Calculate your LTV ratio from property value and mortgage amount. See which rate band you fall into.

Updated for 2026/27 tax year

Published by UltraCalculatorsLast reviewed: 28 Mar 2026v1.0Sources:Bank of England: Mortgage statistics FCA: MCOB rulesEditorial PolicyEstimates only. Always consult a qualified professional.Report an issue

This calculator provides estimates for guidance only. It does not constitute financial advice. LTV ratios affect mortgage rates and eligibility. Consult a mortgage adviser for personalised guidance.

Loan-to-value (LTV) is one of the most important numbers in the UK mortgage market. It represents the proportion of a property's value that is covered by the mortgage, expressed as a percentage. The remainder is your deposit or equity. LTV directly affects which mortgage products are available to you, the interest rate you are offered, and the overall cost of your borrowing. For example, if you are buying a property worth GBP 300,000 and need a mortgage of GBP 240,000, your LTV is 80% and your deposit is 20%. UK lenders group mortgages into LTV bands, with the best interest rates typically reserved for borrowers at 60% LTV or below. Each step up in LTV (75%, 80%, 85%, 90%, 95%) generally comes with a higher rate. The LTV calculation applies equally to first-time buyers, home movers, and those remortgaging. For first-time buyers, the deposit saved determines the LTV. For home movers, equity from the sale of a previous property contributes to the deposit on the new home. For remortgagers, the growth in property value since purchase (or last valuation) may have reduced the LTV, qualifying them for a better rate. Understanding your LTV before approaching lenders helps you set realistic expectations, compare products accurately, and decide whether to save a larger deposit before buying. Even a small improvement in LTV, such as moving from 85% to 80%, can unlock significantly better rates and reduce your monthly payments over the life of the mortgage.

How to Use This Calculator

To calculate your loan-to-value ratio: 1. Enter the property value. For a purchase, use the agreed sale price or the estate agent's valuation. For a remortgage, use a recent valuation or an online estimate from sites such as Zoopla or Rightmove, though your lender will arrange their own valuation. 2. Enter the mortgage amount. For a purchase, this is the total you need to borrow (property price minus your deposit). For a remortgage, this is the amount you wish to borrow on the new mortgage, which is typically your current outstanding balance plus any additional borrowing. 3. Review the results. The calculator shows your LTV percentage, the deposit amount, the deposit as a percentage, and which rate band you fall into. The chart displays the proportion of the property covered by deposit versus mortgage. 4. Experiment with different values. Try increasing the deposit (reducing the mortgage amount) to see how your LTV improves and which rate band you could reach. Even saving an extra GBP 5,000-10,000 can make a meaningful difference if it moves you into a lower LTV band.

How It Works

The LTV formula is straightforward: LTV = (Mortgage Amount / Property Value) x 100. The deposit is the difference between the property value and the mortgage amount: Deposit = Property Value - Mortgage Amount. The deposit percentage is simply 100 minus the LTV. For example, with a GBP 300,000 property and a GBP 240,000 mortgage: LTV = (240,000 / 300,000) x 100 = 80%. Deposit = GBP 300,000 - GBP 240,000 = GBP 60,000. Deposit percentage = 100 - 80 = 20%. The calculator also assigns a risk band based on the LTV: - Below 60%: Excellent, the lowest rates available - 60-75%: Good, competitive rates - 75-85%: Standard, typical rates - 85-90%: Higher rate, limited options - 90-95%: Limited availability, higher rates - Above 95%: Typically unavailable from mainstream lenders

Worked Examples

Example 1: First-time buyer with 10% deposit

Inputs: Property value: GBP 250,000, Mortgage: GBP 225,000

LTV = (225,000 / 250,000) x 100 = 90%
Deposit = GBP 250,000 - GBP 225,000 = GBP 25,000
Deposit percentage = 100 - 90 = 10%
Rate band: Higher rate, limited options (85-90%)

Result: LTV: 90%, Deposit: GBP 25,000 (10%), Higher rate band

Example 2: Home mover with substantial equity

Inputs: Property value: GBP 450,000, Mortgage: GBP 250,000

LTV = (250,000 / 450,000) x 100 = 55.56%
Deposit = GBP 450,000 - GBP 250,000 = GBP 200,000
Deposit percentage = 100 - 55.56 = 44.44%
Rate band: Excellent, lowest rates available (below 60%)

Result: LTV: 55.56%, Deposit: GBP 200,000 (44.44%), Excellent rate band

Example 3: Remortgage after property value increase

Inputs: Current property value: GBP 350,000, Outstanding mortgage: GBP 260,000

LTV = (260,000 / 350,000) x 100 = 74.29%
Equity = GBP 350,000 - GBP 260,000 = GBP 90,000
Equity percentage = 100 - 74.29 = 25.71%
Rate band: Good, competitive rates (60-75%)

Result: LTV: 74.29%, Equity: GBP 90,000 (25.71%), Good rate band

When lenders assess your mortgage application, they use the lower of the purchase price and the surveyor's valuation for the LTV calculation. This means that if you buy a property for GBP 300,000 but the surveyor values it at GBP 280,000, your LTV is based on GBP 280,000. This is known as a "down-valuation" and can unexpectedly increase your LTV, potentially moving you into a higher rate band or requiring a larger deposit. For shared ownership properties, the LTV calculation works differently. You only need a mortgage for your share of the property, not the full value, so the LTV is based on the value of your share. If you are close to an LTV boundary (for example, at 82% when 80% would get you a better rate), it is worth considering whether saving for a few more months or using gifted deposit funds could help you cross that threshold. The interest rate difference between LTV bands can save you thousands over a typical mortgage term.