loan-to-value is the ratio of the mortgage loan amount to the
property's appraised value or selling price (the lesser of the
two). In other words the LTV is the relationship between
the unpaid principal balance of the mortgage and the appraised
Buying a Home:
For example, if you buy a home for $100,000 and want to put
$20,000 as a down payment, your mortgage amount would be
$80,000, making the LTV or loan to value 80%.
Already have a Loan:
the Balance on your Mortgage Loan by the Appraised value of your
home to calculate your LTV.
Lenders use the LTV ratio, along with credit guidelines, loan
amount and term length to determine your interest rate or for