The difference between the value of your home and your outstanding mortgage is known as equity. You could use the equity in your home as your deposit for your new mortgage. Less risk-taking by lenders means lower LTV ratios, so the more equity the better. If you get into trouble making your mortgage repayments your lender needs to be sure it can cover the outstanding mortgage by taking your home and selling it. The lower the LTV the more chance your lender has of achieving this.

To get the best deals on interest rates you’ll need around 20% equity. As a rule, the more equity you have, the lower your interest rate.

Think carefully before securing debt against your home, your home may be repossessed if you do not keep up repayments on your mortgage.