When you are wanting to apply for a mortgage, there are a few key things you need to consider: the value of the property you want to buy and the amount of money you intend to borrow. This is commonly referred to as the ‘loan to value’ (LTV) ratio.

An example for £125,000 could include putting down a deposit of £12,500 (10%), you would own 10% of the property outright, and would need to borrow the remaining 90%. So, the LTV is expressed as 90% and you would need to take out a mortgage of £112,500.

Lenders offer different LTVs on the mortgage products they offer, based on a range of factors, including the perceived risk level of the borrower, and wider market conditions. The majority of lenders will offer up to 85% LTV, some 90% while a few will consider 95%, depending on the level of risk they consider regarding the applicant. With that in mind, the smallest deposit you might be able to put down on a £125,000 mortgage could be around £6,250, but as 95% mortgages are rarer than 85% or 90% products, they are generally more difficult to qualify for.

The larger the deposit you can put down, the better the mortgage products you will usually have access to. So, by putting up as big a deposit as you can, you should be able to benefit from more generous interest rates and a wider variety of products in general.

Here are a few things a potential lender will look at when considering your mortgage application.

How you receive your income – lenders tend to prefer a consistent PAYE salary, so as long as you’re past your probation period (some lenders will accept a mortgage if you’re on a probationary period), you will usually have access to more favourable rates if you are employed on these terms. However, there is a growing market specifically designed for self-employed borrowers, so as long as you can show you have sufficient regular income, you should be able to find a suitable mortgage product.
Your age – a lot of lenders have an upper age limit and won’t consider lending to you on a standard mortgage if you’re over 75.
The type of property you want to buy – properties that have non-standard features or are constructed from certain less commonly used materials are frequently seen as ‘high risk’ by lenders and some will not agree to mortgages for buildings that fall in those categories.
If you’re buying a second property – each lender will have different rules surrounding borrowers who are looking to take out a second mortgage whether it is buy to let or a second home. Those in these situations can generally expect to be offered lower LTVs, higher rates, and more in-depth scrutiny around their overall affordability.


Contact us today to get started on finding the most suitable mortgage product for you. Our experienced advisers will guide you through the application process to give you the best chance of success.