What is a good LTV ratio for a mortgage?

An LTV of 80% or below is considered strong — it means you have at least 20% equity, so you avoid PMI and typically get the best rates. Ratios between 80% and 96.5% are still acceptable but usually require PMI or an FHA loan.

How do I calculate LTV?

LTV = (Loan Amount / Property Value) × 100. For example, a $240,000 loan on a $300,000 property gives an LTV of 80%.

Does a higher LTV mean a higher interest rate?

Generally yes. Lenders charge higher rates for higher-LTV loans because there is less equity cushion if the borrower defaults. An LTV above 80% also triggers PMI costs.

When can I remove PMI?

Under federal law (Homeowners Protection Act), lenders must cancel PMI when your LTV reaches 78% based on the original value, or you can request cancellation at 80% LTV. Refinancing at a lower LTV also eliminates PMI.

What is the maximum LTV for an FHA loan?

FHA loans allow a maximum LTV of 96.5% (minimum 3.5% down payment) for borrowers with a credit score of 580 or higher. With a score of 500–579 the maximum LTV is 90%.

Yes — this is called being "underwater" or having negative equity. It happens when property values fall after purchase. Most lenders will not approve a new loan above 100% LTV.

Loan-to-Value Calculator

Enter your loan amount and property value to calculate LTV ratio and see whether you need PMI.

Loan Details

Loan Amount ($)

Property Value ($)

Quick Examples

Enter loan details on the left and click Calculate.

LTV Threshold Reference

LTV Range	Loan Type	PMI Required?
≤ 80%	Conventional — best rates	No
80.01% – 90%	Conventional — standard	Yes
90.01% – 95%	Conventional — higher PMI	Yes
95.01% – 96.5%	FHA loan eligible	Yes (MIP)
96.51% – 97%	Conventional 97 (Fannie/Freddie)	Yes
> 97%	VA / USDA only (eligible borrowers)	Funding fee
> 100%	Underwater — most lenders decline	N/A

Summary

Enter your loan amount and property value to calculate LTV ratio and see whether you need PMI.

How it works

Enter the loan amount (how much you plan to borrow).
Enter the property value (purchase price or appraised value).
The calculator divides the loan amount by the property value and multiplies by 100.
Your LTV ratio is displayed along with an interpretation (e.g., PMI required, conventional eligible).
A reference table shows standard LTV thresholds used by most lenders.

Use cases

Determine whether you need private mortgage insurance (PMI) before buying.
Check if you qualify for a conventional loan (LTV at or below 97%).
Assess your equity position before applying for a cash-out refinance.
Compare different down-payment scenarios to find the LTV sweet spot.
Verify FHA loan eligibility (LTV up to 96.5%).
Evaluate investment property financing options.
Understand how much equity you need to remove PMI from an existing loan.

Frequently Asked Questions

Last updated: 2026-09-14 · Reviewed by Nham Vu