Loan to Value

« Back to Glossary Index

In real estate, Loan to Value (LTV) is the ratio of the outstanding loan balance to the value of the property expressed as a percentage. The higher the loan-to-value, the less likely the borrower will be able to repay the loan at maturity. Real estate lenders use this important metric, together with debt yielddebt service coverage ratio, among others to assess the risk of a loan and arrive at an appropriate loan amount.

Loan to Value (LTV) = Loan Amount ÷ Property Value

« Back to Glossary Index

Submit a Financing Request

Secure favorable term sheets for your real estate project