Calculate loan-to-value ratio for your mortgage. Check PMI requirements, compare loan programs, and see how property value changes affect your equity and LTV.
The Loan-to-Value (LTV) ratio is the single most important number in mortgage lending. It's simply your loan amount divided by the property's appraised value, expressed as a percentage. An $320,000 loan on a $400,000 home gives you an 80% LTV — the magic threshold where private mortgage insurance (PMI) is no longer required.
LTV determines nearly everything about your mortgage: whether you need PMI (adding $100-300+/month), what interest rate you'll receive (lower LTV = better rates), and which loan programs you qualify for. Conventional loans typically require 80% or less LTV for the best terms, FHA allows up to 96.5% (3.5% minimum down payment), and VA/USDA loans allow 100% financing.
This calculator computes your exact LTV, shows your equity position, and maps your ratio against all major loan programs. The property value scenario table is particularly valuable for existing homeowners wondering if their home has appreciated enough to refinance without PMI, or for buyers evaluating the impact of different down payment amounts. The PMI comparison shows what different insurance rates would cost you monthly and annually.
LTV is one of the few mortgage numbers that changes pricing, PMI, and loan eligibility all at once. This calculator shows where you stand now, what equity you already have, and how much property appreciation or principal reduction would move you below the next important threshold. It also helps you see whether a refinance or extra payment would actually change the loan terms.
LTV = Loan Amount ÷ Property Value × 100 Down Payment = Property Value − Loan Amount Down Payment % = Down Payment ÷ Property Value × 100 Equity = Property Value − Loan Amount Estimated PMI = Loan Amount × 0.5% ÷ 12 (typical) PMI-Free Value = Loan Amount ÷ 0.80
Result: LTV 80.0% — Down Payment $80,000 (20%) — No PMI Required
LTV = $320,000 ÷ $400,000 = 80.0%. Down payment = $400,000 − $320,000 = $80,000 (20%). At exactly 80%, PMI is not required for conventional loans. Equity = $80,000 (20% ownership stake).
LTV is not just a percentage for a worksheet. Certain ranges change the loan terms in practice, especially around PMI removal and rate pricing. Moving from 81% to 79% often matters more than moving from 61% to 59% because it can remove mortgage insurance or improve eligibility for a refinance.
For purchase loans, lenders often underwrite to the lower of the contract price or appraised value. For refinance and PMI removal, the servicer may require a fresh appraisal. If you enter an optimistic home value, the calculator can make the ratio look safer than the lender will treat it, so use a supportable number whenever possible.
The most useful output is often the next target rather than the current ratio. Use the scenario view to estimate how much appreciation, extra principal, or time is required to reach 80%, 78%, or another threshold that matters to your lender. That gives you a practical roadmap for refinancing, PMI removal, or a future purchase.
For conventional loans, you need LTV ≤ 80% (20% down payment) to avoid PMI at origination. If you already have PMI, you can request removal at 80% LTV based on the original value, or it automatically terminates at 78% LTV. For a new appraisal, you may need as low as 75% LTV depending on the servicer and loan age. The exact cutoff depends on the loan program.
PMI typically ranges from 0.3% to 1.5% of the loan amount annually. On a $300,000 loan: 0.5% = $125/month, 1.0% = $250/month. The rate depends on your credit score, LTV, loan type, and coverage amount. Higher LTV and lower credit = higher PMI rates.
Yes. Request a new appraisal from your servicer. If the appraised value shows LTV ≤ 80% (and ≤ 75% for some loan ages under 2 years), PMI can be removed. You typically need a clean payment history and may need to pay for the appraisal ($300-500). FHA MIP cannot be removed on loans originated after 2013 (with < 10% down). That is one reason appreciation matters so much.
PMI (Private Mortgage Insurance) is for conventional loans and can be removed at 80% LTV. MIP (Mortgage Insurance Premium) is for FHA loans and has both upfront (1.75% of loan) and annual components (0.55% annually). FHA MIP lasts the life of the loan for most borrowers, making it more expensive long-term. The loan type determines which rule applies.
Yes significantly. Fannie Mae and Freddie Mac use Loan-Level Price Adjustments (LLPAs) based on LTV and credit score. A borrower with 95% LTV might pay 0.75-1.5% higher in pricing adjustments than someone at 60% LTV. This translates to roughly 0.125-0.375% higher interest rate. Lower LTV usually gets better pricing.
Being underwater means you owe more than the home is worth. You can't refinance traditionally, but options include: loan modifications through your servicer, VA streamline refinance (for VA loans), waiting for appreciation, or making extra payments to build equity. Avoid selling if possible, as you'd need to bring cash to closing. In that case the ratio is a recovery target rather than a refinance trigger.