Compare 80% LTV mortgages

Home movers and remortgagers

This is where 80% LTV is most common. If you've paid down your mortgage or your home has gone up in value, you may already have 20% equity. That equity does the job of a deposit, so you don't need to save cash. If you're moving, the money left after you sell and repay your mortgage can go straight in as your deposit.

Buyers who've saved 20%

Most first-time buyers can't save 20%, but if you have, you can access this level. On a £200,000 home, that's £40,000 and you'd borrow the other £160,000. Lenders usually ask where your deposit came from, so keep your records.

Landlords

Buying to let works differently, and many lenders stop at 75% LTV.

Yes, but fewer lenders offer it than at 75% LTV. Many buy-to-let lenders ask for a deposit of at least 25%. Some specialist lenders go up to 80% LTV, often with extra conditions.

Buy-to-let lenders look at different things from residential lenders. They usually check that the rent you expect to collect covers your mortgage payments by a set margin. They may also look at your income, your experience as a landlord and how many properties you own.

It can matter whether you buy in your own name or through a limited company. That can change which lenders and deals you can use.

Most buy-to-let mortgages are interest-only. You pay the interest each month and repay what you borrowed at the end, so plan how you'll do that.

A deal above 80% LTV is rare for buy-to-let. If you only have a 15% deposit, you may need to look at other options.

There are a few ways to reach a 20% deposit or 20% equity:

• Save. Set a budget and cut back where you can. See how to save up for a deposit.

• Use equity from your current home. If you're moving, the money left after selling can be your deposit.

• Let your LTV fall. As you pay off your mortgage and house prices change, your LTV can drop. If you're remortgaging, check whether you could now be in a better band.

• Use a gifted deposit. Some lenders accept a gift from family. They usually want written confirmation that it's a gift and not a loan.

Say your home is worth £250,000 and you owe £190,000. Your LTV is 76%, and you have 24% equity. That's enough for an 80% LTV remortgage. To reach 75% LTV, you'd need to owe £187,500 or less. That means paying off another £2,500.

Lenders may check where your deposit comes from, so keep records.

You might plan for 80% and still end up above it. Two things catch people out.

A lower valuation

Lenders usually work out your LTV from the lower of the purchase price and their own valuation. Say you agree to buy a home for £250,000, but the lender values it at £240,000. At 80% LTV, they would lend £192,000. That means you'd need a £58,000 deposit, which is £8,000 more than you planned. If the valuation comes in higher than the price, you usually still borrow against the price.

Fees added to the loan

Some lenders let you add fees to your mortgage. That adds to your loan and your LTV. Take a £250,000 home. An 80% LTV mortgage is £200,000. Add a £1,000 fee and you borrow £201,000, which is just over 80%. You could pay the fee upfront instead, or put in £1,000 more deposit.

To qualify for an 80% LTV mortgage you’ll need to meet your mortgage provider’s lending criteria. This can vary depending on the provider, but on the whole, you’ll need a good credit rating and be able to show you can afford the monthly repayments.

When assessing your mortgage application, lenders will look at:

• Your income

• Your outgoings

• Your spending habits

• How much you owe on credit cards and loans

As long as the lender is satisfied you won’t be overstretching yourself and can comfortably afford your repayments, you should be accepted for your mortgage. You’ll also need to show evidence of your deposit and proof of ID.