Home & property · 4 min read
Deposit and LTV: the two numbers worth understanding first
Loan-to-value (LTV) is simply the mortgage as a percentage of the property value. It is one of the cleanest ways to describe how much equity or deposit sits behind a property loan.
Published by The Finance Place
The simple calculation
If a property costs £300,000 and the mortgage is £270,000, the LTV is 90%. The remaining £30,000 is 10% of the property price. Transaction costs normally sit outside that simple deposit calculation.
Why the next deposit milestone can matter
Mortgage pricing and criteria are often organised into LTV bands. That does not mean a bigger deposit is always the right use of every spare pound, but it makes deposit milestones useful to model before committing your cash.
Homeowners use the same idea
For an existing owner, LTV compares the mortgage balance with the current property value. A lower balance or higher value can change that ratio over time.
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