IE
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This guide explains LTV and LTI in plain terms, why they matter for Irish mortgage scenarios, and how to treat them as planning prompts rather than guarantees. Your lender may apply different rules and underwriting steps.
LTV is the loan divided by the property price. For scenario planning, LTV connects directly to your deposit: a higher deposit generally reduces the loan amount, improves the buffer, and can change available rate options.
Even when two borrowers have the same income, different deposits can lead to very different repayment risk because the outstanding balance is different.
LTI is the loan divided by household gross income. It is often used as a quick “how much could we borrow?” prompt, but real approvals can consider more than gross income: net income, stability, existing loans, and childcare costs.
A useful way to use LTI is to test a smaller loan amount and see whether the repayment fits within a comfortable monthly budget after other recurring costs.
Start from a comfortable monthly repayment range, then work backwards: adjust deposit, rate, and term to see what loan amount fits. Use the stress-tested repayment as a buffer check rather than a pass/fail test.
If you are comparing properties, LTV and LTI together can help you understand whether the repayment is high because the property is expensive or because the deposit is too small for the scenario.