What does ltv stand for mortgage

It rolls off the tongue after you get used to it. Go ahead and try it out the next time you speak with your real estate agent or loan officer. It's an easy way to discuss your home financing options before getting too deep into exact dollar amounts, and it might just impress your friends. Can't find the RMS loan officer you're working with here? Find them on the Guild site.

What does LTV stand for? So, what is Loan to Value? As the name suggests, LTV is the maximum amount that the lender will consider loaning to you as a percentage of the value of the property.

This is the Loan to Value Ratio. It is worth noting that the lower the Loan to Value Ratio, the better the other terms of your mortgage are likely to be as a result. To quickly calculate the maximum house price you can afford, simply use this equation:. Of course, there are other criteria, such as your household income to consider and the lender will have set maximum lending criteria in relation to your income too.

Most mortgage lenders price their mortgages in LTV bands, and this allows them to offer lower mortgage rates for lower LTV mortgages. They do this because a lower LTV means there is more equity in the property. Should house prices fall, there is the risk that the value of the property is less than the amount of the mortgage. If the lender needs to recover the mortgage debt by selling the property, they prefer to be more certain they can recover the full debt.

Mortgage brokers are regulated by the Financial Conduct Authority FCA and are required to pass specific qualifications before they can give you advice. Call Mortgage Advice Bureau today on or request a callback. Talk with a member of our mortgage team over the telephone and get advice on which mortgage is right for you. Lines are open Monday to Friday 8am to 8pm and Saturday 9am to 1pm excluding bank holidays. Calls may be recorded. Mortgage Advice Bureau offers fee free mortgage advice for Moneyfacts visitors that call on Your home may be repossessed if you do not keep up repayments on your mortgage.

Keeping your loan-to-value as low as possible is key — particularly if you're approaching the point where you need to remortgage. There are two ways you can influence your loan-to-value:.

The smaller mortgage you have, the better. If you are on a repayment mortgage you will be reducing your mortgage balance with your payments, and could reduce your LTV in the process. You can even accelerate the repayment of your mortgage by overpaying providing your mortgage lender allows this and subject to any conditions or limits , which could put you into a lower LTV band quicker and could potentially help you clear the loan sooner.

However, if you've got an interest-only mortgage, remember that you're only covering the interest and that the balance stays the same. By keeping your house 'in order' well decorated, maintained, etc. You can even increase your property's value by carrying out home improvements like replacing the windows and doors with uPVC, upgrading the kitchen or bathroom and adding things like an en-suite. These may well increase the value of your property and give you a bigger equity in the process.

This could, in turn, help lower your LTV when it's time to remortgage. You can nearly always get a better mortgage rate with a lower LTV. If you do not have a current personal report, Experian will provide a free copy when you submit the information requested. Additionally, you may obtain a free copy of your report once a week through April at AnnualCreditReport. Editorial Policy: The information contained in Ask Experian is for educational purposes only and is not legal advice.

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