Loan-to-value is your loan balance divided by your home's value, expressed as a percentage. It is equity viewed from the lender's side of the table.
Every rate sheet, mortgage insurance rule, and borrowing cap in the industry is organized around it.
LTV counts only your first mortgage. CLTV — combined loan-to-value — counts every loan secured by the home, which is the figure that matters when you add a HELOC or second mortgage.
A $450,000 home with a $195,000 mortgage has a 43% LTV. Add a $15,000 HELOC and CLTV rises to 47%.
LTV is a measure of cushion. If prices fall 15% and your LTV was 60%, the lender is still comfortably covered. At 95%, it is not, and the price of the loan reflects that.
Run your own figures through the calculator. No credit check, nothing saved unless you ask.
Calculate my equityFor pricing, yes. But equity locked in the house is illiquid, so very low LTV is not automatically the best use of your money.
The appraised value they order, not your estimate or the price you paid.
Part of The Homeowner's Guide to Home Equity.
Home equity is your home's value minus what you owe. Here is exactly how it is calculated, with worked examples.
Find out how much equity you have in your home in about a minute, using your home value and loan balances.
Home equity itself does not affect your credit score — but borrowing against it can. Here is how.