What is LTV
Loan to Vlaue or LTV is one of the major indicators used by the finance industry to determine your level of liquidity and therefore your risk to lend to.
Its based on two key factors:
- Total outstanding amount of loans/mortgages secured against your home
- Total value of your home
If you have a high LTV then you'll find it harder to get a good rate on a secured loan or mortgage. However, with a lower LTV you'll be seen as low risk and therefore get better rates.
However, the opposite can also happen if your LTV is too low. At which point its recommended you get a remortgage on your home instead of a secured loan.