See how we can help

Get started online

95% ltv mortgage rates in the UK

Written By:
Myles Robinson - Expert Finance Advisor

Posted: Oct 16, 2022

Fact Checked By:
David Nicholson - Finance Editor

95% LTV mortgage rates – How to get the best rates on 5% deposit mortgages today

Since the introduction of the government’s mortgage guarantee scheme, an increasing number of people have been able to realise their dream of becoming a homeowner.

While the scheme has given much hope, many are still concerned by the prospect of high interest rates.

In this article, we’ll prepare you to climb the property ladder by telling you everything you need to know about 95 percent LTV mortgage rates.

We can get you approved for your mortgage online, start now below:

Get started online


Are the rates higher on 95% LTV mortgages?

Because mortgage lenders consider this type of loan a higher risk to them, they offset the risk through higher interest rates. A 5 percent deposit is generally the lowest percentage at which one could get approved, so the interest rates for this scheme tend to be the highest on the market.

According to, the average interest rate on a two-year fixed rate 95 percent LTV mortgage was 4.47 percent in 2021. Whereas the average interest rate on 90 percent LTV mortgages was lower. Additionally, the average interest rate for a 95 percent LTV on a five-year fixed rate was 4.32, while a 90 percent five-year fixed rate was 3.64%.

Before you lose all hope, do bear in mind that it’s still possible to get a favourable interest rate with a 5 percent deposit but doing so merely requires the right expertise, patience, and a bit of shopping around.

Get started online


Mortgage guarantee scheme alternatives

What many don’t know is that it’s actually possible to get a mortgage with a deposit that’s below 5 percent, although it takes some doing and more than likely a specialist lender. But before you completely rule out 95 LTV mortgages, there are alternatives to the mortgage guarantee scheme that can see you ending up with a 5 percent deposit and favourable rates.

Guarantor mortgages

Guarantor mortgages are for people who don’t have sufficient funds to qualify for a mortgage on their own. With this arrangement, the guarantor essentially agrees to repay the amount borrowed in the event of the borrower failing the make the agreed monthly payments.

You could use a portion of your own funds and a family member’s financial support to make up a 5 percent deposit. Using this route could get you more equity and favourable rates.

This is quite a useful option for those with a bad credit history and may even allow you to get a mortgage without a deposit. The main issue with this scheme is that it primarily depends on a guarantor’s creditworthiness and the value of the assets they’re using as collateral for the deal.

Help to buy

With the help to buy equity loan arrangement, you can be granted access to a government mortgage that is worth 20 percent of a property’s value, thus helping you purchase a house with a 5 percent deposit.

The help-to-buy scheme may also result in you being on the receiving end of more equity and favourable interest rates. However, you’ll have an extra debt to settle. Please note that this scheme is now exclusive to first-time buyers.

Be sure to check out the government’s website for an official breakdown of the mortgage guarantee scheme.

Get started online


Fixed rate mortgage VS variable rate mortgage: Which is better?

When offered a mortgage there are a few different rate options, including fixed rate, standard variable rate mortgages, discount variable rate mortgages, and tracker rate mortgages.

Fixed and variable rate mortgages are the most common and widely discussed, so borrowers are often confused as to which one is ‘better.’

Firstly, it’s important to remember that both fixed mortgages and variable rates have their advantages and disadvantages, so it may come down to which issues you’re willing to deal with. Here are some points for both that you can take into consideration:

Fixed-rate mortgages

  • The amount you pay each month will remain the same throughout the mortgage term, even if the Bank of England’s base rate increases. On the other hand, your rate won’t go down if the Bank of England’s base rate decreases.
  • Fixed-rate mortgages are significantly less flexible, so you won’t be able to overpay more than 10 percent per annum.
  • These mortgages also have early repayment charges.

Variable rate mortgages

  • The cost of your monthly repayments can fluctuate according to wider interest rates and at your mortgage provider’s discretion. This means your monthly repayments can be higher or lower at any given point.
  • These mortgages are more flexible, so there are usually no early repayment charges or limits on overpayment.

It’s not easy to say which one is better but a mortgage broker may be able to make suggestions as to which option may work better in line with your individual situation.

Get started online


What impacts the interest rate on a 95% ltv mortgage?

Besides your interest rate being affected by the type of rate plan you’re on, there are other factors that a 95% ltv mortgage lender will pay extra attention to.

The following criteria are what lenders use to determine your creditworthiness, risk profile, and ultimately your interest rate:

  • Age – If you’re approaching the age of 75 or if the mortgage period will run into your retirement years, then it may be significantly more difficult to get an advantageous interest rate.
  • Credit history – Regardless of the type of mortgage you have your eyes set on, having a good credit history will go a long way in terms of your mortgage application. If you’re aware that your credit is not the best, it’s always recommended that you consult a mortgage broker who can provide you with a suitable application strategy.
  • Your earnings – Lenders tend to prefer people with a steady source of income. They’ll always ask for proof of income and two to three years of accounts, even if you’re self-employed. Always seek professional help if you’re self-employed or have a complicated source of income.
  • Expenses – If you have more money going out than coming in, lenders will pose a lot of questions as to whether you can actually afford the loan. Do your best to ensure your debt-to-income ratio is low before applying, as this could greatly impact the number of mortgage providers that you can approach.
  • The type of property – It can be much more difficult to get a good rate on a ‘non-standard’ property. A non-standard property is any property that isn’t made from bricks and mortar.

Get started online


Comparing mortgages and rates you will pay

A quick Google search is generally not the most ideal way to compare 95% LTV mortgages and find one with a favourable rate.

This method makes it hard to comprehensively understand all the products on offer and what they could mean for your mortgage and mortgage rate.

Most generic online tools and interest tables aren’t tailored to your own needs and thus won’t be 100% accurate. Going through a broker is your best bet if you want to access the best interest rates and get a suitable mortgage deal.


Benefits of using a mortgage broker to get the best 95% mortgage rates

By now, you’re probably exhausted by the number of times we have emphasised the importance of consulting a mortgage broker but, believe us when we say that you have nothing to lose in doing so.

Here are a few reasons why you should use a mortgage broker like Loan Corp:

  • Better access to financial products – Most brokers have an extensive professional network. They can leverage this network to access financial products that lenders don’t advertise. Some mortgage providers only allow access to certain schemes when approached through a broker.
  • Find you the best deals – Finding a mortgage with a favourable rate is far from easy, especially when you don’t have the key knowledge and expertise to do so. Mortgage brokers are typically abreast of key industry trends and
  • Saves you time – One of the best things about mortgage brokers is that you generally only need one application, which saves you from having to complete forms for each individual lender. Mortgage brokers can also provide formal comparisons of loans and guide you through all the adjoined aspects.
  • Saves your money – Because they are offered loans from lenders on a wholesale basis, mortgage brokers can get the best rates on the market. This, in turn, can save you money. Trustworthy brokers also make a noticeable effort to disclose all the costs associated with the loan, so that you aren’t blindsided.
  • Personalised service – Mortgage brokers streamline the process of getting a mortgage by being readily available throughout and working in line with your personal preferences.
  • They are flexible – People often get put off getting a mortgage as they feel that there are no workarounds for their personal situation. Mortgage brokers conduct in-depth assessments of your personal circumstances to find solutions that work for you.


Get the right mortgage with Loan Corp

Loan Corp has a wealth of experience in providing bespoke mortgage solutions. Finding a mortgage at a favourable rate is not easy but it’s not impossible.

At Loan Corp, we have a team of mortgage experts who pride themselves on working closely with customers to help them get the home of their dreams.

If you’re ready to start climbing the property ladder quicker than you thought, get in touch with us via our website or call us at 0808 301 9509 for fee-free mortgage advice.



What is the Financial Services Register?

The Financial Services Register is a public record of entities that have been or are regulated by the Prudential Regulation Authority or Financial Conduct Authority.

Financial institutions such as mortgage lenders should always have a registration number that you can use to verify their registration status and, in turn, their legitimacy.

Luckily, mortgage brokers only associate with trusted mortgage providers, so you don’t have to waste precious time trying to assess the trustworthiness of a lender.

What’s the difference between a repayment mortgage and an interest-only mortgage?

With repayment mortgages, your monthly repayment is split into two parts, one part pays off interest and the other pays the money you borrowed. With interest-only mortgages, you only pay interest on the mortgage.

What does negative equity mean?

This is a situation in which the property value is less than the mortgage you took out on it. Negative equity can make it hard for you to move house or remortgage.

What is a discounted variable rate?

As the name implies, this is a lender’s standard variable rate with a discount applied. If a lender’s standard variable rate is 3 percent then a discounted rate could take it to 2.5 percent.

Get approved for the best 95% mortgage rates online now:

To start your application you can do this online now below:

Get started online