Ltv calculator
Free ltv calculator: enter loan amount and property value to compute your loan-to-value ratio — for CRE investors checking lender eligibility before an offer.
Total principal balance on the first mortgage (and any senior liens)
Appraised or acquisition value — whichever the lender uses for underwriting
Loan-to-Value Ratio (Loan Amount / Property Value)
75.00%
An LTV of 75.00% — moderately high leverage. Conventional CRE lenders typically cap at 75–80% LTV for income-producing properties; above 75% often triggers stricter DSCR requirements or mortgage insurance. Bridge lenders and debt funds may go higher, but at a premium rate. Stress-test your DSCR at this leverage level.
Loan-to-Value Ratio (Loan Amount / Property Value)
75.00%
An LTV of 75.00% — moderately high leverage. Conventional CRE lenders typically cap at 75–80% LTV for income-producing properties; above 75% often triggers stricter DSCR requirements or mortgage insurance. Bridge lenders and debt funds may go higher, but at a premium rate. Stress-test your DSCR at this leverage level.
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
What is LTV in commercial real estate and how is it calculated?
LTV (Loan-to-Value) = Loan Amount / Property Value. For example, a $1,500,000 loan on a $2,000,000 property is a 75% LTV. Lenders calculate LTV using the lesser of the appraised value or the purchase price — not the listing price or your estimate. A lower LTV means more equity and less risk for the lender, typically resulting in better rate and term offers.
What LTV do commercial real estate lenders allow?
LTV limits vary by lender type and asset class. Conventional commercial lenders typically max at 70–75% LTV for stabilized income-producing properties. Agency lenders (Fannie Mae Multifamily, Freddie Mac) may allow up to 80% LTV for qualifying properties with strong DSCR. Bridge lenders and debt funds may go to 80–85% at higher rates. These are ESTIMATES — always confirm with your specific lender and loan program.
How does LTV affect DSCR and cash-on-cash return?
Higher LTV means a larger loan and higher annual debt service. More debt service compresses both your DSCR (NOI / Debt Service) and your cash-on-cash return (Cash Flow / Equity). A deal clearing 1.25x DSCR at 65% LTV may fall below the lender floor at 75% LTV — use the DSCR Calculator to model coverage at your actual loan amount. Lower equity in (higher LTV) can increase cash-on-cash return if the deal is positively leveraged, but amplifies downside risk.
What property value does the lender use for LTV?
Lenders use the lesser of the appraised value or the purchase price for LTV underwriting. For refinances, they use the current appraised value. The appraisal is ordered by the lender and often comes in differently from broker estimates or listing prices — especially in a market correction or for properties with deferred maintenance. Do not assume your purchase price equals the lender's appraised value.
More free CRE tools
- Deal X-Ray | Free AI Underwriting Analyst for Multifamily
Drop any multifamily OM into your Claude. It extracts the deal, rebuilds the math on conservative assumptions, surfaces the red flags a broker buried, and hands back a verdict in three minutes. Free. Your OMs never leave your Claude.
- Cap Rate Calculator for CRE Investors
Free cap rate calculator: enter NOI and property value to get your capitalization rate in seconds — built for CRE investors sizing up acquisition targets.
- DSCR Calculator for CRE Investors
Free dscr calculator: enter NOI and annual debt service to check your debt coverage ratio — built for CRE investors sizing lender-ready acquisitions.