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90% LTV Mortgages

The higher the deposit amount the better the rate you get. We will show you the best deals you only have access to a 10% deposit.

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90% Mortgages

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Your home may be repossessed if you do not keep up repayments on your mortgage. The rates and products displayed within these tables are updated on a regular basis however due to the dynamic nature of the market some product details and rates may be out of date. We therefore do not take any responsibility for the accuracy of the information supplied within the table although we will always make our best endeavour to ensure that the information provided is as accurate as possible. You should always check rates and terms with the product provider. The telephone-based mortgage advice service is provided by TurnKey Mortgages Limited. Registered office: St Crispins House, Duke Street, Norwich NR3 1PD. TurnKey Mortgages Limited are authorised and regulated by the Financial Conduct Authority. Their FCA number is 537424.

90% LTV Mortgage

LTV Explained

LTV (or loan-to-value) refers to the percentage of a loan that is underwritten to the value of an asset that is purchased. Loan-to-value is most often used by banks, building societies and other financial lenders to represent the amount they are willing to lend against the value of the asset. For example if a borrower wishes to borrow £180,000 to purchase a house valued at £200,000, the LTV would be 90%.

 

Below reveals the loan-to-value you would need to apply for the following house valuations.

 

LTV Table Examples

LTV£50k Property Value£100k Property Value£150k Property Value£200k Property Value£250k Property Value
Amount borrowed at: 100% £50,000 £100,000 £150,000 £200,000 £250,000
Amount borrowed at: 95% £47,500 £95,000 £142,500 £190,000 £247,500
Amount borrowed at: 90% £45,000 £90,000 £135,000 £180,000 £225,000
Amount borrowed at: 85% £42,500 £85,000 £127,500 £170,000 £212,500
Amount borrowed at: 80% £40,000 £80,000 £120,000 £160,000 £200,000
Amount borrowed at: 75% £37,500 £75,000 £112,500 £150,000 £187,500
Amount borrowed at: 70% £35,000 £70,000 £105,000 £140,000 £175,000
Amount borrowed at: 65% £32,500 £65,000 £97,500 £130,000 £162,500
Amount borrowed at: 60% £30,000 £60,000 £90,000 £120,000 £150,000

 

If you were interested in a property valued at £150,000 and had a deposit of £15,000, you would apply to borrow the remaining £135,000, which, as we can see from the table above, reflects a 90% LTV mortgage.

 

If you were interested in a property valued at £200,000, and you had £30,000 available for a deposit, you would need to apply for an 85% LTV mortgage worth £170,000.

 

Be sure that you factor stamp duty into your calculations! (Find out more about stamp duty here). If you are purchasing property worth over £125,000, you will face a fee of at least 1%. This can be added to the mortgage, but it may push you onto the next tier of LTV loan (e.g. 85% to 90%), which is likely to be a little more expensive.

 

Why LTV Matters: The Relationship with Cost

Higher LTV mortgages tend to be more expensive (higher interest rates) than one with a lower LTV percentage. This is due to the extra risk that a higher LTV mortgage imposes upon lenders.

 

For example, an 85% mortgage may have an interest rate of 4%, whereas the 90% mortgage might have an interest rate of 4.5%, meaning that monthly payments will be higher, all else remaining the same.

 

What Are The Risks?

Tracker Mortgages

If you take out a tracker mortgage, a rise in the base rate will lead to higher monthly payments. This is more of a risk for high-LTV mortgage holders where repayments are already more costly.

 

Before taking out a tracker mortgage at 90% LTV, it might be worth contemplating what your costs might be if rates do head upwards. See our calculator: what if rates change?

 

Rise and Fall in Value

Any rise or fall in the property value will increase or reduce the value of your deposit (as a overall percentage). Given a 90% LTV mortgage and a 10% deposit, should your home value fall by 5% it would technically leave you with a 5% deposit.

 

In a worst-case scenario, your home value could drop by more than your deposit, leaving you in negative equity (should you sell your home you would not make enough back to pay of your mortgage). This will make getting another mortgage deal more challenging.