Loan-to-Value (LTV) Calculator
Calculate your Loan-to-Value (LTV) ratio to assess loan risk, check home equity percentage, and determine whether Private Mortgage Insurance (PMI) is required.
How to use the Loan-to-Value (LTV) Calculator
- 1Enter current loan balance or mortgage amount.
- 2Enter appraised property value or purchase price.
How LTV is Calculated
Divide loan amount by appraised property value and multiply by 100.
Lenders require PMI on conventional mortgages when LTV exceeds 80%.
- 1LTV = ($425,000 / $500,000) × 100 = 85.00%
- 2Home Equity = 100% - 85% = 15.00% ($75,000)
- 3Requires PMI: Yes (LTV > 80%)
What affects LTV results
- Down payment size at time of purchase.
- Subsequent neighborhood property value appreciation.
Frequently Asked Questions
When can I cancel Private Mortgage Insurance (PMI)?
Under the Homeowners Protection Act, you can request PMI cancellation when your mortgage principal balance reaches 80% of the original home value, and it automatically terminates at 78%.
What LTV ratio avoids Private Mortgage Insurance (PMI)?
An LTV of 80% or lower (20%+ equity or down payment) exempts home buyers from conventional monthly private mortgage insurance premiums.
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