Loan-to-value (LTV) calculator
Loan-to-value compares the amount you borrow with the value of the asset behind the loan. Enter the value, the loan and any other loans secured on it, plus the LTV you want to reach. You get the ratios, your equity and how much to pay down.
Runs in your browser: nothing you enter is sent anywhere.
How to use it
- Enter the value of the property and the loan balance.
- Add other loans secured on the same property, if any.
- Set the LTV you want to reach, such as 80.
How it works
- LTV = loan ÷ value × 100; combined LTV = (loan + other loans) ÷ value × 100.
- Equity = value − loan − other loans.
- Largest loan at the target = value × target ÷ 100 − other loans.
- Pay-down = loan − largest loan, never below zero.
Worked example
A property worth 300,000 has a loan of 255,000 and a second loan of 15,000. LTV is 85%, combined LTV is 90%, equity is 30,000. For an 80% target the largest loan is 240,000 − 15,000 = 225,000, so you would pay down 30,000.
Tips
- A rising value or a falling balance both lower LTV.
- Combined LTV is the figure that matters when you add a second loan.
- Lender limits differ; this tool only does the arithmetic.
Frequently asked questions
How is LTV calculated?
LTV = loan ÷ value × 100. A loan of 320,000 on a 400,000 property is 80%.
What is combined LTV?
Combined LTV (CLTV) adds other loans secured on the same asset: (loan + other loans) ÷ value × 100. It shows the total borrowing against the property.
Why does LTV matter?
Lenders use it to judge risk. Some lenders charge more or ask for insurance when the ratio is above a limit such as 80%. The limits are set by each lender, so check yours.
How is the pay-down computed?
The largest loan allowed is value × target ÷ 100 minus other loans. The pay-down is your loan minus that amount, or zero if you are already under the target.
Which value should I use?
Lenders normally use their own appraisal or the purchase price, often the lower one. An online estimate can differ, so try several values.