## What is the loan to value (LTV)?

The loan to value (**LTV**) is the amount of money a lender is willing to lend you in relation to the value of the home you’re purchasing or refinancing.

It’s calculated as a percentage. If a lender offers a mortgage with a maximum **LTV** of 80 percent, for example, that means they can lend you up to 80 percent of the property value. Mortgage LTVs typically range from 40% up to 90%.

Our LTV calculator is an easy and fast way for you to learn whether your loan-to-value ratio is within those limits.

## What is Loan to Value Ratio (LVR)?

The Loan to Value Ratio (**LVR**) is a term used by lenders to describe how much money you’ll need to buy a home. It’s the amount you’ll need to borrow, expressed as a percentage of the ‘lender-assessed value’ of the house.

Let’s take a closer look at it. Consider the following scenario:

- Let’s assume the property is valued at $400,000 by your lender.
- Assume you have a $80,000 down payment.
- To purchase the house, you’ll need to borrow $320,000.

Your **LVR** would be calculated like this:

$320,000 ÷ $400,000 = 80%

### Loan to Value (LTV) Calculator

The loan to value (LTV) is basically the size of the loan which a lender is willing to offer in relation to the value of the property it buys or redeems.

It is expressed as a percentage. So, for example, if a lender offers a mortgage deal which has a maximum 70% LTV, that means they will lend you up to 70% of the property value.

Mortgage LTVs typically range from 40% up to 80%.

### LTV Ratio Formula

The Loan to Value Calculator uses the following formulas:

**LTV ratio= ALTV = loan / purchase price * 100%PV/ MA**