LTV Calculator UK — Loan to Value Ratio 2026
Calculate your loan-to-value (LTV) ratio instantly and see exactly which mortgage rate bands you fall into. Your LTV is one of the most important factors determining the interest rate you will be offered — use this tool to understand your position and find out what you could save by improving your LTV.
LTV Bands and Typical Rate Guide (2026)
| LTV Band | Deposit / Equity | Typical 2yr Fix Rate | Typical 5yr Fix Rate | Notes |
|---|---|---|---|---|
| Up to 60% | 40%+ | ~3.9% | ~3.7% | Best rates available |
| Up to 75% | 25%+ | ~4.1% | ~3.9% | Very competitive |
| Up to 80% | 20%+ | ~4.3% | ~4.1% | Good range of products |
| Up to 85% | 15%+ | ~4.6% | ~4.4% | Fewer lenders |
| Up to 90% | 10%+ | ~5.0% | ~4.8% | Higher rates, limited range |
| Up to 95% | 5%+ | ~5.6% | ~5.3% | First-time buyers, Mortgage Guarantee |
Rates are illustrative benchmarks for comparison purposes only. Actual rates vary by lender, credit score, property type, and individual circumstances. Always obtain personalised quotes.
What is Loan-to-Value Ratio?
Loan-to-value (LTV) is a percentage that expresses the size of your mortgage relative to the value of the property you are buying or remortgaging. It is calculated by dividing the loan amount by the property value and multiplying by 100. A borrower buying a £300,000 property with a £75,000 deposit (25%) and a £225,000 mortgage has an LTV of 75%. A borrower putting down only £15,000 (5%) on a £300,000 property would have an LTV of 95%.
LTV is one of the most consequential numbers in mortgage lending. It is a direct measure of risk: from a lender's perspective, a borrower with a 25% equity stake has a substantial buffer before the property value would need to fall enough to endanger their loan. A borrower at 95% LTV has almost no such buffer. If the property falls in value by more than 5%, the lender's loan is no longer fully secured. This risk differential is reflected directly in the interest rates lenders charge across different LTV bands.
For borrowers, understanding LTV is essential for three reasons: it determines which products you can access, it largely determines the interest rate you will pay, and it shapes how much flexibility you will have if your circumstances change. Borrowers at lower LTVs have more options, better rates, and greater resilience to property market fluctuations.
How LTV Affects Your Mortgage Rate
The relationship between LTV and mortgage rate is one of the most direct and consistent in the UK lending market. Lenders price their products in LTV bands, with materially different rates at key thresholds. The pricing effect is non-linear: the biggest rate improvements come when you cross certain key thresholds, particularly 90%, 85%, 80%, 75%, and 60% LTV. Within a band, rates are generally similar regardless of exactly where you sit.
To illustrate this with concrete 2026 numbers: a borrower at 95% LTV might expect to pay around 5.6% on a two-year fixed deal. Crossing to 90% LTV (achieved by increasing the deposit from 5% to 10%) could reduce this to around 5.0% — a 0.6 percentage point improvement. On a £250,000 mortgage over 25 years, that difference equates to approximately £100 per month in lower payments and over £20,000 less total interest over a 25-year term.
Moving from 90% to 85% LTV (15% deposit) might reduce the rate to around 4.6% — another substantial saving. The jump from 85% to 75% is particularly significant: at 75% LTV (25% deposit), rates of around 4.1% are typically available. And the golden threshold for the very best rates is 60% LTV — at 40% equity or deposit, rates of around 3.9% on a two-year fix and 3.7% on a five-year fix become accessible from competitive lenders. These figures are illustrative benchmarks; actual rates vary by lender and market conditions, but the directional relationship holds consistently across the market.
LTV Bands and Typical Rate Differences in 2026
The UK mortgage market in 2026 continues to price products in clearly defined LTV bands. Most lenders structure their product ranges around the following key thresholds: 60%, 75%, 80%, 85%, 90%, and 95%. Products at or just below each threshold are available, with rates increasing as you move up the LTV scale.
At the 60% LTV tier — requiring a 40% deposit or equity — borrowers can access the most competitive rates in the market. These products are typically offered by all major mainstream lenders and come with the widest range of deal types and flexibility. For first-time buyers, reaching 60% LTV is rarely achievable on an initial purchase except on lower-value properties, but for remortgaging homeowners who have benefited from capital growth and years of repayments, it becomes increasingly accessible over time.
The 75% tier is the most commonly targeted threshold for borrowers who cannot or do not wish to provide a 40% deposit. Most buy-to-let mortgage products are capped at 75% LTV, making this the critical threshold for investment property finance. For residential mortgages, 75% LTV unlocks significantly better rates than 80% or above, and the difference in monthly payment compared to 90% or 95% LTV products can be hundreds of pounds per month on a typical UK loan.
At 80% LTV, a good range of mainstream products remains available, though rates step up noticeably compared to 75%. At 85%, the range narrows and rates increase further. At 90% — the maximum for most standard residential mortgage products — rates are notably higher, though the market has improved significantly since 2020 when 90% products temporarily disappeared during the COVID-19 crisis. At 95% LTV, products are available primarily for first-time buyers and are supported by the government's Mortgage Guarantee Scheme, which underwrites lenders against losses on 91-95% LTV mortgages.
How to Improve Your LTV
There are several strategies for improving your LTV ratio, each with different timescales and feasibility depending on your circumstances. The most direct approach for a purchase is to save a larger deposit — every additional pound you save reduces both your LTV and, potentially, your monthly payment. For existing homeowners, LTV can be improved through capital overpayments on the mortgage, benefiting from property price growth, or both.
Making mortgage overpayments is one of the most tax-efficient ways to build equity and reduce LTV. Most mortgage products allow overpayments of up to 10% of the outstanding balance per year without early repayment charges. For a borrower with a £250,000 mortgage who overpays £10,000 in a year, the LTV improves immediately, and when they come to remortgage, they may find themselves in a better rate band — potentially saving more in interest than the return they could have earned by investing that £10,000 elsewhere, depending on prevailing rates.
Property price growth naturally improves LTV over time without any action from the borrower, though this is not guaranteed and should not be relied upon. Homeowners who purchased in 2018-2020 and have seen significant house price appreciation may find that their LTV has dropped considerably even without making overpayments, potentially qualifying them for much better rates at their next remortgage. Conversely, falls in property values push LTV higher, which is why overleveraged buyers are most exposed to market downturns.
LTV for Remortgage vs Purchase
LTV is calculated the same way whether you are purchasing or remortgaging — loan divided by property value — but the practical dynamics differ significantly. When purchasing, your LTV is set by the deposit you can provide relative to the purchase price. The purchase price itself determines the reference value, though the lender's surveyor valuation may differ and will take precedence if lower.
When remortgaging, your LTV is determined by your outstanding mortgage balance relative to the current market value of your property. This means remortgaging LTV changes over time as you make repayments and as property values fluctuate. Many homeowners who took out mortgages at 90% LTV five or ten years ago find themselves remortgaging at 70% or 65% LTV, unlocking substantially better rates — this represents one of the most significant financial rewards of homeownership over time.
For a remortgage, you may need to arrange a property valuation. Many lenders offer free desktop valuations for remortgages, which use algorithmic data to estimate property value without a physical inspection. These can work in your favour if property values in your area have risen, but they carry some risk if the estimate is lower than the actual market value. A full surveyor valuation, while it costs money, provides certainty and may be worth commissioning if you believe your property value is close to a key LTV threshold.
Negative Equity Explained
Negative equity occurs when the value of your property falls below the outstanding mortgage balance — in other words, when your LTV exceeds 100%. In this situation, if you sold the property for its current market value, the proceeds would not be sufficient to repay the mortgage in full. This was a significant problem in the UK following the 1990s housing crash, when some borrowers were trapped in negative equity for years.
Negative equity does not require immediate action as long as you can continue making mortgage payments. Your lender cannot force you to sell or repay the excess immediately simply because your LTV has risen above 100%. However, it creates serious practical problems: you cannot remortgage to a new lender (as no lender will accept a property with an LTV above their maximum as security for a new loan), you are likely stuck on your current lender's SVR, and you cannot sell without finding additional funds to make up the shortfall between sale proceeds and the mortgage balance.
Frequently Asked Questions
A good LTV ratio is generally considered to be 80% or below, as this is where most lenders begin offering meaningfully better interest rates. The very best mortgage rates in the UK are reserved for borrowers with an LTV of 60% or below — representing a 40% deposit or equity stake. At 75% LTV you will access competitive rates from the majority of mainstream lenders, while at 80% rates are decent but noticeably higher than at 75%. At 85% and 90% LTV, rates increase significantly, and at 95% — the minimum for most near-100% products — you will pay the highest residential rates available. For buy-to-let mortgages, most lenders require a maximum 75% LTV as a hard cap.
To calculate your loan-to-value ratio, divide your mortgage loan amount by the property value and multiply by 100. For example, if your property is worth £300,000 and your mortgage is £225,000, your LTV is (225,000 / 300,000) x 100 = 75%. For a purchase, the loan amount is the purchase price minus your deposit. For a remortgage, the loan amount is your outstanding mortgage balance. The property value used is typically the lower of the purchase price and the lender's surveyor valuation, so if the surveyor values the property below the agreed price, your effective LTV will be higher. Use the calculator at the top of this page to calculate your LTV instantly.
Generally yes, but the improvements are concentrated at specific LTV thresholds — particularly 60%, 75%, 80%, 85%, and 90% — rather than being linear. Moving from 91% to 89% LTV typically makes a bigger difference to your available rate than moving from 65% to 63% LTV, because these percentage points cross into a new pricing band. Within a band, rates are usually similar regardless of exactly where you sit. This means that if your LTV is just above a key threshold — say 76% — it can be very worthwhile making a capital payment to push below 75% and access lower rates. Calculate whether the interest saving over your next deal period exceeds the cost of the additional capital payment.
Your LTV can increase if property values fall while your mortgage balance remains relatively static. If your LTV rises above 100% (negative equity), you cannot remortgage with a new lender and may be trapped on your existing lender's Standard Variable Rate. Even short of negative equity, a rising LTV can push you into a higher rate band when you come to remortgage — so a borrower who expected to remortgage at 75% LTV and instead finds themselves at 82% LTV due to a property value fall will face higher rates than anticipated. This is why many financial advisers recommend maintaining a meaningful equity buffer rather than borrowing to the maximum available LTV.
The maximum LTV for a buy-to-let mortgage is typically 75%, meaning you need at least a 25% deposit or equity stake. A small number of specialist lenders offer buy-to-let mortgages up to 80% LTV, but these carry significantly higher rates and fees and are not available from most mainstream buy-to-let lenders. The 75% cap reflects the higher risk of investment property for lenders — rental income can cease, tenants may cause damage, and investment properties are more likely to be sold in financial difficulty. Some lenders apply lower LTV caps for properties considered higher risk, including houses in multiple occupation (HMOs), multi-unit freehold blocks, flats above a certain floor, and new-build apartments. Portfolio landlords face additional underwriting requirements under PRA rules. Use the buy-to-let calculator to model rental yield and affordability at different LTVs.