LTV question

decker27

Hi All,
I have completed my initial mortgage period and I am looking to make an early repayment to get my Loan to Value amount down to 60% and thus have a wider range of mortgages to choose from with better initial rates when I remortgage.
My question is can I just pay enough early repayment to get my LTV down to say 60.99% to qualify for the 60% LTV deals or do I have to pay so my LTV is literally down to 60.00% to qualify.
Does anybody know as on (for example) a £300000 mortgage the different of 0.99% is around an extra £2970 to pay in an early repayment.
Thanks in advance

Wutang_2

If you want 60% ltv then the mortgage needs to be 60% of the property value!!!!!

kingstreet

Are you planning to remortgage, or do you plan to ask your current lender for a customer retention product at a lower LTV?

If it's the latter, why don't you establish their bandings before you do anything? There are some lenders who have 0 - 75%, so paying the mortgage down to 60% isn't going to matter, rate-wise.

If you are planning to change lenders and can find a sub-60% deal, the first thing that's going to happen when you apply is a valuation. Only when you know what the surveyor actually values it at are you going to know what it's going to take to get down to 60%. It's 60.0% too, not 60.9%.

I'd look for a valuation fee-free deal in the first instance. In that way, if you don't get the valuation you want, you can change lenders without it costing you.

decker27

Thanks Kingstreet - gives me a lot more to think about.
Very new to all this but have some spare cash in some savings that thought would be better paying off the mortgage and then seeing if we can get lower monthly payments.

Thrugelmir

Make an allowance for the valuation undertaken on behalf of the lender being lower than yours, i.e. be conservative.

kingstreet

decker27 wrote: »

have some spare cash in some savings that thought would be better paying off the mortgage and then seeing if we can get lower monthly payments.

You don't have to make the overpayment before you think about changing the mortgage. Once you have definite figures to work with, such as the valuation and the LTV limit of the deal you fancy, then you can calculate what overpayment to make. All I'm suggesting is the overpayment might be timed differently.

The other issue is the mortgage rate versus the savings rate you can get. If you're going to have a tracker at 2.8%ish, the savings rate might be higher so you would then seek to limit the amount of overpayment you need to secure the mortgage deal, in favour of maximising the amount you keep in savings.