Glossary term
Loan-to-value ratio
The amount of lending secured by a property divided by the property value accepted for the calculation.
Plain meaning
What loan-to-value ratio means
Loan-to-value ratio, or LTV, expresses secured lending as a percentage of the property value accepted for the calculation.
How OpenBook uses it
A borrowing-boundary measure
OpenBook uses LTV to explain mortgage-insurance, refinancing, and home-equity-borrowing boundaries.
Common boundary
The numerator and denominator depend on context
Different rules can apply to total secured lending, the mortgage portion, and a HELOC's non-amortizing portion. The denominator may be a lender-accepted appraisal rather than an owner estimate.