# Often asked: What is ltv?

## What does 60% LTV mean?

As the name suggests, LTV is the maximum amount that the lender will consider loaning to you as a percentage of the value of the property. For example, a mortgage with a maximum Loan to Value Ratio of 60 % would probably be offered with a lower interest rate.

## What does 80% LTV mean?

For example, suppose you buy a home that appraises for \$100,000. However, the owner is willing to sell it for \$90,000. If you make a \$10,000 down payment, your loan is for \$80,000, which results in an LTV ratio of 80 % (i.e., 80,000/100,000).

## What is a good LTV?

What Is a Good LTV? If you’re taking out a conventional loan to buy a home, an LTV ratio of 80% or less is ideal. While you might pay higher interest on a car loan with a higher LTV ratio, there’s no threshold comparable to the 80% LTV that earns the best mortgage loan terms.

## How do you work out LTV?

You can do this by dividing your mortgage amount by the value of the property. You then multiply this number by 100 to get your LTV.

## What is the max LTV?

A maximum loan-to-value ratio is the largest allowable ratio of a loan’s size to the dollar value of the property. The higher the loan-to-value ratio, the bigger the portion of the purchase price of a home is financed.

## Does LTV affect interest rate?

A loan-to-value ratio is a calculation that measures how much of your home’s value you’re borrowing. Your LTV ratio may affect your interest rate, monthly payment and how much you can borrow.

## Can I get a 90 LTV mortgage?

90 % Loan to Value ( LTV ) Mortgages. A 90 % is suitable for those with existing mortgages and those looking to get on the property ladder with a smaller deposit.

## Can I refinance at 90 LTV?

You can refinance with as little as 3.5 percent equity — a 96.5 percent loan-to-value — with a Federal Housing Administration loan in which the government insures the lender against default. Typically, you need at least 10 percent equity — a 90 percent LTV to refinance with a conventional loan.

## What is a 90 LTV loan?

With a 90 % LTV mortgage, you borrow 90 % of the cost of the home you want to buy and put down the remaining 10% as your deposit, which will most likely either be from cash savings or home equity.

## Is LTV based on appraisal?

Lenders use loan-to-value calculations on both purchase and refinance transactions. When this happens, your home’s LTV is based on the lower appraised value, not the home’s purchase price. With a refinance, LTV is always based on your home’s appraised value, not the original purchase price of the home.

## What is a good LTV to CAC ratio?

An ideal LTV:CAC ratio should be 3:1. The value of a customer should be three times more than the cost of acquiring them. If the ratio is close i.e. 1:1, you are spending too much.

## How much LTV do I need to refinance?

Think of LTV as an inverse of equity — the lower your LTV ratio, the more equity you have in your home. When it comes to refinancing, a general rule of thumb is that you should have at least a 20 percent equity in the property.