I've Seen Someone Get a Better Rate by Borrowing £1 Less

Can borrowing £1 less really get you a better mortgage rate? It sounds ridiculous, but I’ve seen it happen. In this video, I explain how loan-to-value (LTV) bands can mean that borrowing just £1 less can sometimes move you into a different pricing bracket — and why that can make a surprisingly big difference to the interest rate you pay. Today I am looking at Lifetime Mortgages, but the same applies to standard residential mortgages too. It's just that the numbers will look a little different. I use a real-world example of borrowing £48,001 compared with £48,000, before looking at the much more realistic question: could borrowing £2,000 less actually be worthwhile if it means accessing a lower rate? But there’s an important balance. Borrowing less isn’t automatically better if it means wiping out your savings or leaving yourself financially stretched. Equally, you shouldn’t automatically borrow more simply because that’s what you originally thought you needed. The right answer depends on your circumstances. That’s why good mortgage and equity release advice isn’t simply about finding the lowest rate. It’s about understanding what you actually need, looking at the alternatives, and finding the right balance for your situation. Want to see what rates and LTV bands might be available to you? Our free online calculator can give you an indication of the latest rates and help identify where the potential LTV breakpoints are. You can use our free equity release calculator here: https://www.moneyrelease.co.uk/Equity... *About Money Release* At Money Release, we help homeowners aged 50+ understand their mortgage and equity release options, so they can make informed decisions about what’s right for them. No pressure. No assumption that equity release is the answer. Just straightforward advice based on your circumstances. The information in this video is for general information purposes only and does not constitute financial advice. Rates, products and eligibility criteria can change, and individual circumstances will affect the options available. If you are considering a mortgage or equity release, you should seek personalised advice. *Chapters:* 00:00 How £1 can change your mortgage rate 00:32 Why I might recommend borrowing less 01:48 What is loan-to-value (LTV)? 02:44 Finding the LTV “sweet spot” 04:05 How much could you actually save? 05:20 £48,000 vs £50,000 06:00 When borrowing less isn't the right answer 06:15 How to find the right amount to borrow