What is loan-to-value (LTV) and why does it matter?
Last reviewed 14 July 2026 · Smarter Mortgage Quotes editorial team
This guide is written for borrowers who want to understand the numbers before speaking with an adviser. It is general information, not a regulated mortgage recommendation.
Loan-to-value is the mortgage as a percentage of the property price (or valuation). It’s the single biggest factor in the rate you’ll be offered.
How LTV is calculated
Mortgage ÷ property value × 100. £180,000 mortgage on a £200,000 property is 90% LTV.
The bands that shape your rate
- 60% LTV — best rate tier. Major lenders compete hard here.
- 75% LTV — typically the “best mainstream” band.
- 85% LTV — strong choice, rates only slightly above 75%.
- 90% LTV — viable, rates step up noticeably.
- 95% LTV — fewer lenders, higher rates.
Drop a band with a small top-up
If you’re at 91% LTV, finding another 1% of deposit drops you into the 90% band — often saving £40–£100/month.
LTV after a remortgage
Your LTV usually falls naturally over time — you’ve paid down some balance and the property may have grown in value. A new valuation at remortgage often unlocks a much better band.
Want to see how your LTV affects your borrowing? Use our borrowing calculator or speak to an adviser about your options.
Frequently asked questions
How do I calculate loan-to-value? +
Divide the mortgage amount by the property value, then multiply by 100. For example, a 180,000 mortgage on a 200,000 property is 90% LTV.
Does a lower LTV guarantee a lower mortgage rate? +
No. Lower LTV can improve access to rate bands, but the rate offered still depends on lender criteria, product availability, affordability, and your circumstances.