Ltv calculator

Where AI changes the answer

Loan-to-Value (LTV) is the ratio lenders use to gauge how much of the property's value is financed by debt — and how much equity is absorbing the risk. A 75% LTV on a $2,000,000 property means a $1,500,000 loan and $500,000 in borrower equity. LTV = Loan Amount / Property Value. Lenders calculate this using the lesser of the appraised value or the purchase price — not your broker's estimate or the asking price. The appraisal is the number that matters. **How LTV connects to your DSCR and cash-on-cash return:** Higher LTV means more loan proceeds (less equity out of pocket) but also more debt service. More debt service compresses your DSCR and cash-on-cash return. A deal that clears 1.25x DSCR at 65% LTV may fall below the lender floor at 75% LTV if the additional debt service eats into NOI. AI can model how a 5-point LTV shift changes your required equity, DSCR, and cash-on-cash — confirm the actual covenant with your lender, as these are ESTIMATES. **Typical LTV limits by lender type (ESTIMATES — confirm with your lender):** Conventional commercial lenders typically cap at 70–75% LTV for stabilized income-producing properties. Agency programs (Fannie Mae Multifamily, Freddie Mac Optigo) may allow up to 80% LTV for qualifying assets with strong DSCR. Bridge lenders and debt funds often go to 80–85% LTV at a premium rate. CMBS programs typically land in the 65–75% range for permanent financing. **What moves your LTV?** Your down payment (equity in), the negotiated purchase price, and the lender's appraised value. A $100,000 difference in the appraisal on a $2,000,000 property changes LTV by 5 points — and can push you into a higher-rate tier or make a deal unfundable at your target leverage. Related tools: after computing LTV, run the DSCR Calculator to confirm your debt service coverage at that loan amount, and the Cap Rate Calculator to benchmark the unlevered yield so you understand your spread to your debt cost.

Questions real estate teams ask