What Is Loan-to-Value Ratio?

Loan-to-value ratio (LTV) compares how much you owe on the mortgage to the home's value. Lenders use it to gauge risk. On many conventional loans, LTV above 80% is when PMI enters the picture.

Why LTV matters beyond PMI

Lower LTV often means better rate quotes and more loan options. A larger down payment reduces the amount you borrow and the interest you pay over time. The down payment guide walks through those tradeoffs.

Original value vs current value

PMI cancellation rules on many conventional loans refer to the home's original value at closing, not what Zillow says today. Market appreciation can improve your real equity, but servicers may still use original value unless you qualify for an appraisal-based review.

Check your LTV with the PMI calculator using your home price, down payment, and quoted PMI rate.