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Loan-to-Value (LTV) Calculator
Loan-to-value compares what is owed on a property with what it is worth. Enter the loan, the value and any other loans secured on the property to see LTV, combined LTV, equity and what a target ratio requires.
The LTV and CLTV formulas
Loan-to-value is the loan divided by the property value, shown as a percentage: LTV = Loan ÷ Value × 100. A 240,000 loan on a 300,000 property is 80%, which means the lender funds four fifths of the value and you hold one fifth as equity.
Combined loan-to-value adds every loan secured on the same property: CLTV = (Main loan + Other loans) ÷ Value × 100. It matters when you apply for a second mortgage or a home-equity line, because the lender cares about total borrowing against the property, not only the first loan.
Why lenders look at it
A lower ratio means a bigger cushion if prices fall or the property has to be sold. Lenders therefore often tie the interest rate, the maximum loan and the need for mortgage insurance to the ratio. The exact bands differ by country, lender and product, and they change over time, so the table here only lists common reference points and the target field is editable. Ask your lender for its actual thresholds rather than assuming.
If your ratio is just above a threshold, a modest extra down payment or a paydown may cross it. The paydown row shows how much that takes at your target.
Which value to use
For a purchase, lenders generally use the lower of the price and the valuation, so enter that figure. For a refinance, they use a valuation or appraisal. Market estimates and online guesses can differ from a formal valuation, and a small change in value moves the ratio: the same 240,000 loan is 80% of 300,000 but 85.7% of 280,000. Run the calculator at a cautious value as well as an optimistic one. To see how the ratio and your deposit relate, use the down payment calculator.
Limits
The tool does not include costs added to the loan, such as financed fees or insurance premiums, unless you add them to the loan amount. Treat it as an educational estimate; the lender's valuation and rules decide what you can actually borrow.
Two practical notes. First, the ratio can change without any payment on your side: if the property value falls, LTV rises, and if it rises, LTV falls. Second, as you repay a standard amortizing loan the balance drops slowly at first and faster later, so the ratio improves gradually in the early years. For a refinance or a home-equity line, the combined ratio is the one a lender will focus on, so enter every secured loan in the other-loans field, using the amount drawn on a credit line rather than the limit.
Worked example
A 350,000 mortgage and a 30,000 home-equity line on a property valued at 420,000, tested against an 80% target.
Inputs
| Main loan amount | 350000 |
|---|---|
| Property value | 420000 |
| Other loans secured on the property | 30000 |
| Target ratio | 80 % |
Result
Combined LTV 90.48% with 40,000.00 of equity.
| Loan-to-value (main loan) | 83.33% |
|---|---|
| Combined loan-to-value (all loans) | 90.48% |
| Equity (value minus all loans) | 40,000.00 |
| Equity as a share of value | 9.52% |
| Largest total borrowing at 80% | 336,000.00 |
| Paydown needed to reach 80% | 44,000.00 |
| Value needed for the current debt to sit at 80% | 475,000.00 |
Borrowing allowed at common ratios for this value
| Ratio | Total borrowing | Main loan after other loans | Cash or equity at that ratio |
|---|---|---|---|
| 70% | 294,000.00 | 264,000.00 | 126,000.00 |
| 80% | 336,000.00 | 306,000.00 | 84,000.00 |
| 90% | 378,000.00 | 348,000.00 | 42,000.00 |
| 95% | 399,000.00 | 369,000.00 | 21,000.00 |
| 100% | 420,000.00 | 390,000.00 | 0.00 |
- Largest main loan at the target ratio, after the other loans: 306,000.00.
Financial disclaimer: Results are estimates for planning and education. They are not financial, tax or legal advice. Fees, taxes, rates and rules vary by lender, product and country, so confirm figures with your provider or a qualified adviser before making decisions.
Frequently asked questions
How do I calculate loan-to-value?
Divide the loan amount by the property value and multiply by 100. For example, 240,000 on a 300,000 property is 80%.
What is the difference between LTV and CLTV?
LTV uses only the main loan. CLTV adds every other loan secured on the property, such as a second mortgage or home-equity line.
What is a good LTV?
Lower is safer for both borrower and lender. Where the thresholds sit depends on the lender and the loan product, so check the actual limits.
How do I lower my LTV?
Pay down the loan, put more money down on a purchase, or wait for the value of the property to rise.
Which value should I enter on a purchase?
Normally the lower of the price and the lender's valuation, since that is the figure most lenders use.
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References and sources
- Consumer Financial Protection Bureau: educational material on mortgages, equity and home-equity loans. Link
- Loan-to-value and combined loan-to-value as defined in standard mortgage finance texts.