How do you work out your LTV rate?

J

Joe Nonety

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E.g. If you bought a house for €85,000 using a 100% mortgage at 4% fixed rate of interest for 5 years. If this house is now worth €100,000 and you've paid back €5000 of your mortgage, what's your LTV rate?
 
Outstanding Loan = 80k
House value = 100k

LTV = 80/100 = 80%

[post crossed with above]
 
Would it not depend on long the 5000 was paid off?
It is was paid off over a period of time then a percentage of it would be interest on the original sum
So, LTV would be between 80%-85%

To get the LTV you need to know the current blanance of the mortgage
 
Thanks for the replies. I didn't think the maths would be that easy as surely not all the money you pay back, particularly at the start, is paid against the loan amount?
Surely a big proportion of the €5000 paid back is interest?
Regarding the question asking how long; assume 12 months as I think a mortgage of €85000 at 4% interest is about €400 a month over 30 years.
 
as surely not all the money you pay back, particularly at the start, is paid against the loan amount?
Click to expand...
I presume the posters presumed you meant €5000 paid off capital.

based on a repayment of 4% over 30 years the capital balance would be approx €83,500 giving an LTV of 83.5%
 
Molly,

You are of course right but he did say he had "paid back €5k of an €85k mortgage".

If it's a 30 year loan then the repayments in the early years will be more than 50% interest so probably only €2k paid back.
 
Joe Nonety said:
E.g. If you bought a house for €85,000 using a 100% mortgage at 4% fixed rate of interest for 5 years. If this house is now worth €100,000 and you've paid back €5000 of your mortgage, what's your LTV rate?
Click to expand...

to put this to bed:

LTV % = (Mortgage Amount Outstanding / Value of house) * 100

JoeNonety - just ring your bank and ask them how much is outstanding.
 
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