Loan-to-value ratio (LTV)

The loan amount divided by the property's appraised value, expressed as a percentage. A $200,000 loan on a $250,000 home is 80% LTV. Lenders use LTV to assess risk — lower LTV means more equity and less risk. LTV above 80% typically triggers PMI on conventional loans. Non-QM and jumbo lenders also use LTV to set rates: lower LTV usually means a lower rate.