People type this into search every day: loan to value ratio calculator.
The usual answer is “loan divided by value.” That is the whole formula. The useful part is what the percent does to mortgage insurance, the rate, and the equity you think you have.
This page is a labeled estimate. It is not an appraisal, and it is not a lending decision.
Loan over value, then the leftover
The CFPB LTV note says loan-to-value compares the amount you are financing with the appraised value. A higher down payment lowers LTV. Lenders use that ratio to decide whether to lend, whether they want private mortgage insurance or a government-backed loan, and which rate they offer. Higher LTV usually means a higher rate.
Their PMI page says conventional loans with a down payment under 20% often require PMI. PMI protects the lender, not you. A 20% down payment is an 80% LTV.
Their PMI cancellation page says you can ask to cancel PMI when the principal is scheduled to hit 80% of the original value, and the servicer must generally terminate it automatically at 78% if you are current.
The loan-to-value ratio calculator is the division:
loan balance ÷ current asset value × 100
The value is a current estimate. Only the secured loan you type is included. Those are the tool’s assumptions.
Fig 1
Loan over value
Equity is the leftover, not a separate input
Divide the loan by the value. What remains is the share that is not financed.
The home equity post is the other view of the same split. Gross equity is value minus secured debt. LTV is the financed share.
Example 1: the published $320,000 on a $420,000 house
Here are the calculator defaults:
- loan balance: $320,000
- current asset value: $420,000
LTV: 320000 ÷ 420000 × 100 = 76.2%
Estimated equity: 420000 − 320000 = $100,000.00
Value not financed: 100000 ÷ 420000 × 100 = 23.8%
Calculator result
Loan-to-value ratio
- Loan balance
- $320,000.00
- Current asset value
- $420,000.00
76.2%
loan-to-value ratio
- Estimated equity
- $100,000.00
- Value not financed
- 23.8%
76.2% sits under the 80% PMI line on a conventional loan. 23.8% is the down-payment-shaped leftover, but only if $420,000 is still the value and $320,000 is still the only lien.
Fig 2 · 1/2
The $420,000 house
Defaults: $320,000 loan
Loan
$320,000
Equity
$100,000
The loan is $320,000.00, 76.2% of value.
Equity is $100,000.00, the other 23.8%.
Example 2: 20% down on the same $420,000
The mortgage payment defaults use this house with $84,000 down. Loan: 420000 − 84000 = $336,000.
LTV: 336000 ÷ 420000 × 100 = 80%
Equity: $84,000.00
Value not financed: 20%
80% is the conventional PMI line the CFPB describes. Cross it and the lender can ask for insurance. Stay on it with 20% down and PMI is not required on that conventional path.
Calculator result
Loan-to-value ratio
- Loan balance
- $336,000.00
- Current asset value
- $420,000.00
80%
loan-to-value ratio
- Estimated equity
- $84,000.00
- Value not financed
- 20%
The down payment post already walks the cash to get here. This ratio is what that cash buys.
Example 3: 5% down
- loan: $399,000
- value: $420,000
LTV: 399000 ÷ 420000 × 100 = 95%
Equity: $21,000.00
Value not financed: 5%
95% is 15 points above the 80% line. The CFPB says that higher LTV can mean PMI and a higher rate. This tool will not price the insurance. It will tell you that you are at 95%.
Example 4: 3.5% down, the FHA-shaped number
HUD’s loan programs page is the FHA door. A 3.5% down payment on $420,000 is 420000 × 0.035 = $14,700. Loan: $405,300.
LTV: 405300 ÷ 420000 × 100 = 96.5%
Equity: $14,700.00
Value not financed: 3.5%
96.5% is a government-backed shape, not a conventional 20% down. Mortgage insurance works differently on FHA. Type the loan you actually have.
Fig 3 · 1/4
Four down payments on $420,000
Loan is purchase price minus the cash down
- LTV
| Category | LTV |
|---|---|
| 23.8% in | 76.2% |
| 20% down | 80% |
| 5% down | 95% |
| 3.5% down | 96.5% |
20% down is 80% LTV.
5% down is 95%. 3.5% down is 96.5%. The default 76.2% already has more than 20% equity.
Example 5: what if the value drops 10%
Keep the $320,000 loan. The house is now 420000 × 0.90 = $378,000.
LTV: 320000 ÷ 378000 × 100 = 84.7%
Equity: $58,000.00
Value not financed: 15.3%
The loan did not grow. LTV jumped from 76.2% to 84.7%, a lift of 8.5 points. Equity fell from $100,000 to $58,000, a drop of $42,000. That $42,000 is the whole 10% price move: 420000 × 0.10 = $42,000. A 10% price drop does not cut LTV by 10 points. It cuts the leftover.
A 10% rise goes the other way. Value 420000 × 1.10 = $462,000.
LTV: 320000 ÷ 462000 × 100 = 69.3%
Equity: $142,000.00
Fig 4 · 1/2
The same $320,000 loan
Value moves. The loan stays put.
- Loan
- Equity
| Category | Loan | Equity |
|---|---|---|
| −10% | $320k | $58k |
| Default | $320k | $100k |
| +10% | $320k | $142k |
At $378,000 the leftover is $58,000.
At $420,000 it is $100,000. At $462,000 it is $142,000.
Example 6: the common mistake, hide a second lien
The LTV tool takes one loan. A $30,000 home-equity line on top of $320,000 is $350,000 of secured debt.
If you type only the first mortgage:
LTV: 76.2%
If you type both:
LTV: 350000 ÷ 420000 × 100 = 83.3%
Equity: $70,000.00
Value not financed: 16.7%
76.2% looked like a PMI-free conventional leftover. 83.3% does not. Combined loan-to-value is the name lenders use when more than one lien sits on the house. This calculator will only see the number you type.
The home equity estimate calculator defaults already add a second balance: $310,000 mortgage plus $10,000 other liens on a $480,000 house. Combined LTV there is 320000 ÷ 480000 × 100 = 66.7%. Gross equity $160,000.00. After a 6% sale-cost haircut the tool prints $131,200.00 net.
Calculator result
Home equity estimate
- Estimated home value
- $480,000.00
- Mortgage balance
- $310,000.00
- Other secured balances
- $10,000.00
- Estimated selling costs
- 6%
$131,200.00
estimated net equity after sale costs
- Gross equity
- $160,000.00
- Estimated selling costs
- $28,800.00
- Loan-to-value
- 66.7%
Example 7: the 80% and 78% PMI marks on the original $420,000
The CFPB cancellation page uses original value, not a later appraisal, unless you refinanced. On $420,000:
80% of original: 420000 × 0.80 = $336,000 loan. LTV 80%. Equity $84,000.00.
78% of original: 420000 × 0.78 = $327,600 loan. LTV 78%. Equity $92,400.00.
You can ask to cancel PMI at the 80% schedule if you meet the payment-history tests. Automatic termination is the 78% date if you are current. A later appraisal can move the date if the value fell.
Example 8: a car loan on a $22,000 car
The formula does not care that the asset is a house.
- loan: $18,000
- value: $22,000
LTV: 18000 ÷ 22000 × 100 = 81.8%
Equity: $4,000.00
Value not financed: 18.2%
81.8% on a car is a different conversation than 81.8% on a house. There is no PMI page for tires. The ratio still tells you how much of the asset the lender owns.
Example 9: cash, and the other edge, underwater
All cash, $0 loan on $420,000:
LTV: 0%
Equity: $420,000.00
Value not financed: 100%
Loan above value, $450,000 on $420,000:
LTV: 450000 ÷ 420000 × 100 = 107.1%
Equity: −$30,000.00
Value not financed: −7.1%
Negative equity is the name for that leftover. The net worth post puts the same minus in a household list.
Fig 5 · 1/5
LTV if only the value moves
Loan stays $320,000. Value from $360,000 to $480,000.
Loan-to-value
- LTV
| Point | LTV |
|---|---|
| $360k | 88.9% |
| $390k | 82.1% |
| $420k | 76.2% |
| $450k | 71.1% |
| $480k | 66.7% |
At $360,000 the ratio is 88.9%.
At $420,000 it is 76.2%. At $480,000 it is 66.7%.
320000 ÷ 360000 = 88.9%. 320000 ÷ 390000 = 82.1%. 320000 ÷ 450000 = 71.1%. 320000 ÷ 480000 = 66.7%. Those four plus the 76.2% default are the line.
The rent vs buy model starts from a purchase LTV you pick when you choose the down payment. After closing, this calculator is the live ratio as the value and the balance move.
The nine ratios next to each other
| Example | Loan | Value | LTV | Equity |
|---|---|---|---|---|
| 1. Defaults | $320,000 | $420,000 | 76.2% | $100,000 |
| 2. 20% down | $336,000 | $420,000 | 80% | $84,000 |
| 3. 5% down | $399,000 | $420,000 | 95% | $21,000 |
| 4. 3.5% down | $405,300 | $420,000 | 96.5% | $14,700 |
| 5a. Value −10% | $320,000 | $378,000 | 84.7% | $58,000 |
| 5b. Value +10% | $320,000 | $462,000 | 69.3% | $142,000 |
| 6. Two liens | $350,000 | $420,000 | 83.3% | $70,000 |
| 7. Auto-PMI mark | $327,600 | $420,000 | 78% | $92,400 |
| 8. Car | $18,000 | $22,000 | 81.8% | $4,000 |
| 9. Underwater | $450,000 | $420,000 | 107.1% | −$30,000 |
Open the loan-to-value ratio calculator with the current balance and a value you can defend. Add every secured lien if you want the combined ratio. Use the home equity estimate calculator when you also need a sale-cost haircut. Use the mortgage payment calculator so the ratio sits next to the monthly principal and interest, not in place of it.