LTV over the mortgage term
Scenarios
Save up to four versions of the deal to compare them side by side. They stay in this browser.
Repayment schedule
How the figures are worked out
Term and fix. The schedule runs the full mortgage term. The fixed rate applies for the fixed period and the reversion rate from the month after (blank = same as the fixed rate). The end of the fix is marked on the chart and in the schedule.
Repayment type. Interest only, part or full. Full repayment is an annuity over the mortgage term (after any interest-only months), re-set at the reversion rate over the remaining term when the fix ends. For part repayment, enter how much is repaid by the end of the fix, either as LTV points (75% down to 70% is 5% of the property value) or as a share of the loan.
Level payment sizes the payment during the fix so the balance hits the target exactly at the end of the fix. That payment implies an amortisation period A = −ln(1 − L·r/pmt) ÷ ln(1 + r); after the fix the payment is re-set at the reversion rate over A less the months already amortised, and whatever is left at the end of the term is due then. Straight-line repays the same capital each month (the target ÷ the amortising months in the fix) plus interest, carrying on after the fix until the balance is gone or the term ends.
Fees. A lender fee can be paid upfront, deducted from the advance or added to the loan. When it is added, interest is charged on it and the max gross LTV applies to the loan including the fee: if it breaches the cap, the net loan is reduced to fit.
True rate is the annualised rate that equates what the client actually receives (the advance less any fee deducted or paid upfront and the broker fee) with every payment during the fix, the balance at the end of the fix and any exit fee on it, on the same basis as an APRC. Interest, fees and cost are measured over the fix too. The note under the results also gives the DAS Source product-card measure (interest and fees over the fix ÷ years of the fix ÷ loan) so the two can be read side by side.
Questions brokers ask
What is partial amortisation?
A loan that repays part of the balance over the term rather than all of it or none of it. Commercial and larger buy-to-let lenders often ask for the LTV to come down by a set amount, such as 75% to 70% over five years, with the balance refinanced at expiry.
Level payment or straight-line principal?
A level payment is the same every month and is what most lenders quote. Straight-line repays equal capital each month plus interest, so payments start higher and fall. Check which the lender uses before you quote the client a figure.
Why is the true rate different from the product-card true rate?
The calculator's true rate discounts every cash flow, as an APRC does, so it reflects a balance that falls over the term and fees taken at the start. The product-card measure spreads interest and fees evenly over the years against the starting loan. Both are shown so you can compare like for like with the sourcing results.
How does the max gross LTV work with an added fee?
Lenders apply the cap to the loan including the added fee. If net LTV plus the fee breaches it, the calculator reduces the net loan so the gross loan sits on the cap, and shows the reduction.
Are the results advice?
No. The calculator is for reference by FCA-authorised intermediaries. Payments, fees and repayment terms must be checked against the lender's offer before advising a client.
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