Loading page...
finance calculator
Calculate loan-to-value ratio for mortgages and financing.
Keep this tool handy during home searches, refinance planning, or home equity loan evaluations.
LTV ratio
80.00%
Summary
LTV ratio
80.0%
Loan to property value.
Home equity
$80,000
Unencumbered property value.
Equity share
20.0%
Your ownership percentage.
PMI status
Avoided
Conventional mortgage rule.
D3 visualization
See the division of property value between your outstanding debt and your net home equity.
D3 visualization
Your loan-to-value ratio compared to the conventional mortgage PMI threshold.
Guide
The Loan-to-Value (LTV) ratio is a critical lending risk assessment metric. Lenders use LTV to determine the risk of a mortgage or home equity loan, and to decide if private mortgage insurance (PMI) is required.
A lower LTV ratio represents more equity in the home, which generally qualifies you for better interest rates and fewer lender fees.
For conventional mortgages, an LTV ratio above 80% (meaning a down payment under 20%) usually triggers a requirement for private mortgage insurance (PMI). Refinancing or home equity products may also enforce maximum LTV limits, typically around 80% to 85%.
Home equity
The market value of a homeowner's unencumbered interest in their real property.
PMI (Private Mortgage Insurance)
Insurance that protects conventional lenders from loss if a borrower defaults on a mortgage.
LTV measures equity. Higher equity (lower LTV) lowers the risk for the lender because the home value is more likely to cover the remaining loan balance in a foreclosure.
You can lower LTV by making a larger down payment, paying down the loan balance faster, or if the appraised value of the property increases.
Formula
LTV = (Loan amount / Property value) × 100Lower LTV usually improves approval odds and loan pricing.
Step by step
Related guides
Guide
Understand loan-to-value ratio, how it affects mortgage approval, interest rates, PMI requirements, and refinancing eligibility.
Guide
Calculate how much home you can afford based on income, debt, down payment, interest rates, and ongoing costs like taxes, insurance, and maintenance.