Loan-to-Value (LTV) Calculator
Evaluate your borrowing power. Calculate your LTV ratio to determine loan eligibility, avoid PMI, and understand your equity position.
Know Your Risk, Lower Your Rate
When you walk into a bank to ask for a loan, the first number they look at isn't your income—it's the LTV Ratio. This single percentage tells the bank how risky the loan is. A high LTV suggests you have very little "skin in the game," while a low LTV shows you have significant equity. Our calculator helps you find this number instantly so you can negotiate better terms.
What is Loan-to-Value (LTV)?
**Loan-to-Value (LTV)** is a financial assessment ratio used by lenders to express the ratio of a loan to the value of an asset purchased.
The formula is simple:
How to Use This Tool
You need two numbers:
- Loan Amount: This is the amount you are borrowing. If buying a home, it is the Home Price minus your Down Payment.
- Value: This is the appraised value of the home or car.
Example: Buying a $500,000 home with a $100,000 down payment means your loan is $400,000. LTV = 400,000 / 500,000 = 80%.
Buying a Home
Lenders prefer an LTV of 80% or less. If your LTV is higher (e.g., 90%), you will likely have to pay Private Mortgage Insurance (PMI), which increases your monthly cost.
Refinancing
Want to cash out equity? Most banks limit cash-out refinances to 80% LTV. If your home has appreciated in value, your LTV might be lower than you think!
Auto Loans
If your LTV is over 100% (called "underwater" or "negative equity"), you owe more than the car is worth. This is a dangerous financial position.
Frequently Asked Questions
How do I remove PMI?
Typically, once your LTV ratio drops to **78%** (through paying down the loan or home appreciation), your lender must automatically cancel PMI. You can request cancellation at 80%.
What is Combined LTV (CLTV)?
CLTV includes ALL loans on the property. If you have a first mortgage AND a HELOC (Home Equity Line of Credit), the CLTV is (Mortgage + HELOC) / Value.
Is a 97% LTV bad?
It's not "bad," but it's expensive. Programs like FHA loans allow LTVs up to 96.5%, and some conventional loans go to 97%, but you will pay higher interest and mortgage insurance premiums.
Valuation Disclaimer
This calculator relies on your input for "Appraised Value." A bank will require an official appraisal to confirm this value before lending.
Data Privacy
We do not store your financial data. This calculator runs entirely in your browser.