20% deposit mortgages.
Mortgages for real life
Purchasing or remortgaging with a 20% deposit? You’ll need an 80% loan to value mortgage.
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Your questions answered
The lowdown on 80%
loan to value mortgages.
If you’re a first time buyer and have been [gifted a deposit] from a family member you may be able to use this alongside your own funds to access an 80% LTV mortgage.
You don’t just have to be a first time buyer, as [gifted deposits] can usually also be used by second time buyers, home movers and even existing homeowners seeking to [remortgage] and use the funds to reduce their borrowing.
Take a look at our [gifted deposit] page for the latest information.
Generally, yes. It will of course depend on the terms of your existing mortgage, and what 80% loan to value mortgages are available from other providers – along with their individual lending criteria. For a guide to remortgaging check out our [remortgaging page].
You’ll need to know three things. Firstly, the purchase price/value of the new property. Secondly, how much you will be putting towards the purchase yourself as a deposit– through cash savings and/or equity in your current home. Finally, subtract the deposit amount from the purchase price and this will give you the mortgage required, which can be calculated as a ratio of the purchase price.
For example: you have seen a house for £325,000 and have £57,500 equity in your current home, which you will be adding £10,000 cash to. This means you need a mortgage of £257,500 which is 79.2% loan to value – meaning you can access 80% LTV deals.
Generally the lower your LTV ratio the better interest rate you’ll be able to access. But whilst it can be tempting to use your funds to reduce your mortgage balance, you should carefully assess whether you can afford to reduce your savings and have money left over to adequately cover unexpected – or expected – overheads. It’s best to do some thorough financial planning to decide what’s right for you, and you may also decide to enlist the help of an independent financial advisor.
We took out a mortgage on our house to help children get on the property ladder and have found Ipswich now Suffolk Building Society a friendly, professional and human organisation – just like building societies and banks used to be but so few are these days. A great team of people.
I have always found it very easy to contact Suffolk Building society by phone, or by email or on line, and the staff are always friendly, knowledgeable, helpful and efficient. For me, this is the most important feature of a good building society.
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