High Loan to Value Mortgages

What is the Loan-To-Value ratio (LTV)?

The loan to value ratio of a mortgage indicates how much of your property you own outright (covered by your deposit, and commonly known as equity) and the amount you are borrowing (covered by your mortgage), expressed as a percentage. Therefore, a 95% LTV mortgage means that you are borrowing almost the entire value of the property and paying only a small deposit. For example, if you were to buy a property worth £500,000 on a 95% LTV mortgage, you would pay a deposit of £25,000 and borrow the remaining £475,000 in the form of the mortgage. To compare top mortgage rates and find the best 95% LTV mortgage deals for you, use the mortgage calculator to search over 5,000 mortgage deals based on your personal circumstances.

Who is eligible for a 95% LTV mortgage?

A 95% LTV mortgage is at the higher end of the range of LTV deals available, as it only requires a 5% deposit, and may therefore be suitable for those who are first time buyers or do not have the resources to save up a larger deposit. Some mortgage lenders now offer Help to Buy mortgages under a Government-backed scheme, which may accept deposits from 5% upwards. However much or little you wish to borrow, there are certain criteria that you will need to fulfill in order for your mortgage application to be successful.

If you apply for a 95% LTV mortgage, lenders will consider criteria such as:

• Your earnings – Do you earn enough to borrow the amount you want?
• The stability of your income – Are you self-employed or new in a job?
• Your outstanding debts – How much debt do you have?
• Your credit rating – Have you ever missed a mortgage payment or other repayment in the past? Do you have any County Court Judgments (CCJs) against you? Have you even been bankrupt?
• Your eligibility for the Help To Buy scheme – if you apply for a 95% LTV mortgage under the Help to Buy scheme you will be required to fulfill certain additional criteria specific to this scheme.

How much will a 95% LTV mortgage cost?

A high LTV mortgage, such as a 95% LTV mortgage, will generally be more expensive than mortgages with lower LTVs as the bank is taking on more risk due to the greater amount owed. For this reason it is there are currently no 95% LTV mortgages available that are not part of the Government’s Help to Buy scheme. To find the best 95% LTV mortgage deals, see the tables above or use our whole of market mortgage advice service.