LTV Calculator

The loan-to-value ratio is a comparison of how much you owe on a loan versus the current market value of the asset securing it — such as a home or car. It is expressed as a percentage. For example, a $180,000 loan on a $250,000 property gives an LTV of 72%.

The formula is simple: divide your current loan balance by the asset's current value, then multiply by 100. So if you owe $180,000 on a home worth $250,000, your LTV is (180,000 ÷ 250,000) × 100 = 72%.

Generally, an LTV of 80% or below is considered good for mortgages — it typically means you avoid private mortgage insurance (PMI) and may qualify for better rates. For auto refinance loans, an LTV under 100% is preferable, though many lenders will consider up to 125%.

An LTV above 100% means you owe more on the loan than the asset is currently worth. This is known as negative equity, or being 'upside down' or 'underwater' on your loan. It can make refinancing more difficult, though some programs and lenders may still work with you.

Most lenders prefer an LTV under 100% for auto refinancing. An LTV between 100% and 125% may still qualify with some lenders, but expect stricter terms or higher rates. Above 125%, options become limited though not impossible depending on your credit profile.

A lower LTV signals less risk to lenders, which typically translates to better interest rates. Borrowers with an LTV of 80% or below generally receive the most competitive mortgage rates and avoid the added cost of private mortgage insurance.

You can lower your LTV by paying down your loan balance faster, making a larger down payment upfront, or waiting for your property's market value to appreciate. Home improvements can also increase appraised value and thereby improve your LTV.

They are related but opposite measures. Equity is the portion of the asset you actually own outright (asset value minus loan balance), while LTV measures how much of the asset's value is still financed. A lower LTV means higher equity.