Mortgage Blog
How To Improve LTV (Loan to Value) ratio
March 26, 2024 | Posted by: Sarabjit Dhuna
First of all, What is LTV(loan to Value)? In simple words, LTV is ratio of the amount of the mortgage in your property to appraised value of that house. Lenders use this metrics to asses the risk associated with the property.
When you have bad credit and high LTV ratio then it's really difficult for lender to accept the mortgage application. To reduce risk, lender may offer larger interest rate and larger down payment.
Ways to Improve your LTV ratio: -
1) This is one of the best method to improve LTV is to offer larger down payment to lender. This can reduce LTV ratio so, risk associated with mortgage application can also be reduced.
2) Secondly, try to increase your credit score by paying bills on time, clearing all the debts related to credit card, if you see any errors on credit reports then speak with credit bureau.
3) You can sign guarantors who has stronger credit profile than you so, it can reduce risk regarding LTV and your profile become more stronger for mortgage application.
If you are looking for any residential mortgage solutions then you can contact Sarabjit.
