What does LTV, or Loan-to-Value mean?
LTV stand for loan to value ratio. It is simply the ratio of the amount of money borrowed to the market value of the home. For example, let’s assume you want to borrow $180,000 and your home value is $200,000. The loan to value ratio (LTV) would be $180,000/$200,000 or 90%. The lender will set the LTV based on program terms and individual borrower qualifications. Generally, the better your credit rating, the higher LTV a lender will allow you. With higher LTV loans a lender will usually require a mortgage insurance premium.
