Calculator
Definition – What is Loan to Value (LTV)?
LTV is a measurement of the loan amount to the value of the borrowed asset.
Formula – How to calculate LTV
LTV = (Borrowing Amount / Asset Value) x 100%
Example
A loan has borrowing amount of $1,250 on an asset value of $5,700.
LTV = ($1,250 / $5,700) x 100% = 0.2193 x 100% = 21.93%
Therefore, the LTV is 21.93%.
Sources and more resources
- Wikipedia – Loan-to-value ratio – Wikipedia’s entry on loan-to-value. It includes a short description on the topic.
- The Balance – Loan to Value Ratio – An article explaining the concept of loan to value ratio.
- Investopedia – Loan-To-Value Ratio – LTV Ratio – A short description of LTV.