Mortgage 101
Loan-to-value is the loan amount divided by the property value. A $400,000 loan on a $500,000 home is 80% LTV. Lower LTV usually means more options.
Purchase LTV uses the price or the appraisal, whichever the program says is lower. Refinance LTV uses the appraisal. CLTV adds other liens, like a second mortgage.
Questions
They are mirrors. 10% down is about 90% LTV, before any financed fees.
The appraisal, unless the contract price is lower on a purchase.
Combined loan-to-value. First mortgage plus other property liens, divided by value.
Financed FHA MIP or a VA funding fee increases the loan amount. Some guidelines measure LTV before that fee.
Higher LTV is more risk, so mortgage insurance, pricing, and maximums change.
A larger down payment or a lower price does. Paying points does not.
Reviewed by Patrick Crawford, NMLS #231625 · Last updated October 28, 2026