Which are the best 80% LTV mortgages?

6 min Read Published: 15 Apr 2021

Best 80% LTV mortgages What is an 80% LTV mortgage?

The loan-to-value (LTV) ratio is the size of your mortgage compared with the value of the property. If you have an 80% LTV mortgage it means the mortgage is worth 80% of the total value, with the remaining 20% coming from a deposit for first-time buyers or equity built up in the property for those remortgaging.

To work out the LTV, you simply divide the mortgage amount by the value of the property. So, for a property worth £250,000, with a deposit of £50,000, the calculation is:

£200,000 / £250,000 = 0.8 (multiply by 100 = 80% LTV)

Generally speaking, the lower the LTV, the lower the rate you will pay on your mortgage. For further information on deposits for first-time buyers, check out our article "How much deposit do first-time buyers really need?"

How can I find the best 80% LTV mortgage for me?

Whether you are a first-time buyer, remortgaging or moving home you will need to decide which type of 80% LTV mortgage to choose. The two most popular options are:

  • Fixed-rate 80% LTV mortgage: A fixed-rate deal means your monthly repayment is set at a certain level for a specific amount of time, which ranges from 2 years up to 40 years. For more details, read "What is a fixed-rate mortgage? Everything you need to know"
  • Tracker rate 80% LTV mortgage: A tracker rate typically follows the Bank of England base rate, with the monthly payments fluctuating if this base rate changes. Again, you can choose a specific period - generally 2 or 5 years - at a set percentage above the base rate, before the mortgage reverts to a standard variable rate, which is more expensive. There is more information in our article "What is a tracker mortgage and is it right for you?"

Once you have decided the type of mortgage you would like, check out our mortgage comparison tool , powered by Habito, which instantly provides you with details of the best options for your specific circumstances. Alternatively, contact online mortgage broker Habito* directly as its advisers will be able to guide you through the available deals, as well as providing access to products from lenders who will only allow applications through an intermediary.

Meanwhile, the tables below give you an indication of the interest rates you can expect to pay, the monthly repayments and the arrangement fees charged by the lenders. They also show each lender's standard variable rate (SVR), which borrowers will be moved to at the end of the initial deal.

Best 80% LTV mortgages for first-time buyers

Based on a property valued at £250,000 with a £50,000 deposit and a mortgage term of 25 years. It is based on a repayment mortgage with the fees paid upfront.

Cheapest 2-year fixed-rate 80% LTV mortgages - (First-time buyers)

Provider Initial interest rate Monthly payment Fees SVR
Yorkshire Building Society 2.05% £852 £585 4.49%
RBS 1.99% £846 £1,025 3.59%
NatWest  1.99% £846 £1,025 3.59%

Cheapest 5-year fixed-rate 80% LTV mortgages - (First-time buyers)

Provider Initial interest rate Monthly payment Fees SVR
Principality Building Society  2.29% £876 £73 4.40%
Yorkshire Building Society 2.25% £872 £585 4.49%
RBS 2.22% £869 £1,025 3.59%

Cheapest 2-year variable rate 80% LTV mortgages - (First-time buyers)

Provider Initial interest rate Monthly payment Fees SVR
Leek United Building Society  1.70% £818 £1,100
5.19%
Newcastle Building Society  1.55% £804 £1124
3.96%
Marsden Building Society  1.99% £846 £175
5.70%

 

Best 80% LTV mortgages for people remortgaging

Based on a property valued at £250,000 with a £50,000 deposit and a mortgage term of 25 years. It is based on a repayment mortgage with the fees paid upfront.

Cheapest 2-year fixed-rate 80% LTV mortgages - (Remortgaging)

Provider Initial interest rate Monthly payment Fees SVR
TSB 2.39% £886 £0
3.59%
Nationwide  1.99% £836 £999
3.59%
Lloyds Bank  1.88% £836 £999
3.59%

Cheapest 5-year fixed-rate 80% LTV mortgages - (Remortgaging)

Provider Initial interest rate Monthly payment Fees SVR
Lloyds Bank 1.92% £839 £999
3.59%
Yorkshire Building Society 1.92% £839 £1,765 4.49%
Nationwide  2.19% £866 £999
3.59%

Cheapest 2-year tracker 80% LTV mortgages for remortgage - (Remortgaging)

Provider Initial interest rate Monthly payment Fees SVR
Furness Building Society  1.49% £798 £1,139
5.14%
Leeks United Building Society  1.70% £818 £1100
5.19%
Monmouthshire Building Society  1.75% £823 £624
4.74%

What are the advantages of an 80% LTV mortgage?

  • Cheaper rates than for higher LTV alternatives
  • A better choice of products than for higher LTV deals

What are the disadvantages of an 80% LTV mortgage?

  • If you can secure an extra 5% deposit, lenders tend to offer much better rates at 75% LTV
  • If you are buying in an expensive area, a 20% deposit could be high and take a long time to save up

What are the alternatives to an 80% LTV mortgage?

If you are considering a higher LTV mortgage, read our articles "Which are the best 95% LTV mortgages - and should I get one?" and "Can I get a mortgage without a deposit?"

 

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