What is a loan-to-value ratio?
Loan-to-value ratio (LTV): A loan-to-value ratio (LTV) compares the amount of a loan with the value of the asset securing it, such as your home.
For home equity borrowing, lenders often look at the combined loan-to-value ratio (CLTV): your existing mortgage balance plus the new loan or line, divided by your home's appraised value.
Each lender sets its own LTV limits, which affect how much you may be able to borrow against your home.
When you compare offers
Estimating your LTV before you apply gives you a sense of how much equity you may be able to borrow against.
Related guides
- How Much Can You Borrow Against Your Home?
How lenders estimate your usable home equity, what combined loan-to-value means, and what else shapes how much you may be able to borrow with a home equity loan or HELOC.
- Home Equity Loan vs. HELOC: What to Compare
How a home equity loan differs from a HELOC, what it means that your home secures the debt, and the details worth comparing before you borrow against your equity.
This glossary is for general educational purposes and isn't financial, legal or insurance advice. Lendara is not a lender and does not make credit decisions. Lendara is a free online marketplace that connects you with participating lenders and providers, who set their own eligibility rules, rates, fees and terms. Lendara may receive compensation from partners, which may affect which offers appear and their order.