65% LTV mortgages (35% deposit) – how they work

65% LTV mortgages: the basics

A 65% LTV mortgage is a home loan where the lender advances 65% of the property’s purchase price. You provide the remaining 35% as a deposit.

For many home buyers, this can be a relatively low loan-to-value, which may affect the range of mortgage options available and the overall cost of borrowing.

What does “LTV” mean?

LTV (loan-to-value) is the relationship between:

• the mortgage amount (the loan), and
• the property value (the purchase price, or the valuation figure used by the lender).

It’s expressed as a percentage.

So, if a property is worth £250,000 and you take out a mortgage at 65% LTV:

• Mortgage: £162,500 (65%)
• Deposit: £87,500 (35%)

How 65% LTV mortgages work

With a 65% LTV mortgage, you’re borrowing a smaller proportion of the property’s value than with higher-LTV deals. That typically means:

• you start with more equity in the home (because your deposit is larger), and
• the lender’s exposure is reduced compared with lending at, for example, 90% or 95% LTV.

Repayments and ownership

Most borrowers use a repayment mortgage, where your monthly payments cover:

• the interest, and
• a portion of the loan balance.

Over time, the balance reduces until the mortgage is paid off.

If you choose an interest-only mortgage, your monthly payments usually cover only the interest, with the repayment of the original loan balance arranged separately at the end of the term.

Is a 65% LTV mortgage a good idea?

A 65% LTV mortgage can be attractive if you can comfortably fund a 35% deposit and want to reduce borrowing risk from the lender’s perspective.

Potential advantages

• More equity from the start: a larger deposit means you’re not as exposed to swings in property value.
• Often more product choice: lower LTVs can open up more mortgage options.
• Lower overall borrowing: because you’re borrowing less, you may pay less interest over the life of the mortgage (depending on the rate and term).

Potential drawbacks

• Tying up savings: putting 35% down can significantly reduce your cash buffer.
• Longer time to save: reaching a 35% deposit may take longer than saving for a smaller deposit.
• Moving costs still apply: even with a strong deposit, buyers often need to budget for costs such as legal fees and stamp duty.

Can you get a 65% LTV remortgage?

Yes, it’s possible to remortgage at around 65% LTV, but it depends on your circumstances and the lender’s criteria.

When remortgaging, the key factor is your current loan balance compared with the property’s current value.

What can affect whether you can remortgage at 65% LTV?

• Your property value: if your home has increased in value, your LTV may fall.
• Your mortgage balance: repayments (and any overpayments) reduce the amount you owe.
• Your affordability: lenders will assess whether you can afford the new payments.
• Any existing mortgage terms: if you’re in a fixed period, there may be early repayment charges to consider.

What types of 65% mortgages are available?

At 65% LTV, you may find common mortgage structures, including:

• Repayment mortgages – you pay off both interest and capital over time.
• Interest-only mortgages – you pay only the interest during the term, with the capital repaid separately.
• Fixed-rate mortgages – the interest rate is set for a defined period.
• Variable-rate mortgages – the interest rate can change during the term (including discount and tracker-style products).

The best choice depends on how you want your monthly payments to behave, and how long you plan to stay in the property.

65% LTV vs other LTV levels

In general, the lower the LTV, the more favourable the options can be—because the lender is taking on less risk relative to the property value.

However, the “best” LTV is personal. A 65% LTV mortgage may suit you if:

• you can afford the deposit without stretching your finances,
• you want to reduce borrowing exposure, and
• you’re comfortable with the time it takes to save a larger deposit.

If you’re buying sooner with a smaller deposit, a higher-LTV mortgage may be the route that gets you into the market earlier—though it can come with different pricing and product availability.

65% LTV mortgage FAQs

Can I get a 65% LTV mortgage with bad credit?

A larger deposit can help demonstrate lower risk, but bad credit does not automatically rule you out. Whether you can get a mortgage depends on the lender’s specific criteria and how your overall application is assessed.

Even with a 65% LTV, lenders will still consider factors such as affordability, credit history, and the stability of your income.

Can first-time buyers get a 65% LTV mortgage?

Yes. First-time buyers can apply for 65% LTV mortgages, provided they can meet the lender’s requirements and fund the 35% deposit from their own resources.

It’s also worth remembering that lenders look beyond deposit size, including your credit profile and whether the mortgage payments fit your budget.

Is 65% LTV better than a higher LTV?

Often, yes—because a lower LTV usually means the lender is lending a smaller share of the property’s value. That can influence the range of products available.

That said, a higher-LTV mortgage may still be sensible if it helps you buy sooner and the overall affordability works for you.

What deposit do I need for a 65% LTV mortgage?

A 65% LTV mortgage typically requires a 35% deposit.

For example, on a £200,000 property, a 35% deposit would be £70,000, with the mortgage covering £130,000.

Summary

A 65% LTV mortgage means borrowing 65% of the property value and putting down a 35% deposit. For many buyers, it can offer a balance between keeping borrowing risk lower and accessing mortgage options that may be more competitive than higher-LTV alternatives.

If you’re considering a 65% LTV mortgage—whether for a first purchase or a remortgage—the most important factors are affordability, the deposit impact on your savings, and how your property value and mortgage balance affect your LTV over time.