LTV and LTC calculator
LTV is the loan divided by the property's value; on a purchase, lenders use the lower of the price or the appraisal. In the illustration below, a $2,400,000 loan on a $3,000,000 purchase that appraises at $3,200,000 is 80.0% LTV, not 75.0%. For construction, the test is loan-to-cost. Pick the case below.
Updated . Runs in your browser; nothing you type is sent anywhere unless you choose to request a quote.
Loan-to-value
80.0%
–
Estimate from your inputs, not a quote.
Get a quote with these numbersYour numbers stay in this browser until you send the request. Janover Capital LLC arranges financing; it is not a lender.
The rule behind each number
- LTV. LTV = the loan amount divided by the value of the property securing it, measured at origination1. The same guidelines add that LTV is measured at origination and counts all senior liens on the property2, so a second mortgage counts.
- Value on a purchase. On an acquisition, LTV uses the lower of the purchase price or the appraised value1.
- LTC. LTC = the loan amount divided by total cost (property plus all construction costs)3.
Leverage ceilings and program maximums
| Loan type | Limit |
|---|---|
| Raw land (bank ceiling) | 65% maximum LTV for raw land2 |
| Land development (bank ceiling) | 75% maximum LTV for land development2 |
| Commercial and multifamily construction (bank ceiling) | 80% maximum LTV for commercial, multifamily and other nonresidential construction2 |
| Improved property (bank ceiling) | 85% maximum LTV for improved (completed, income-producing) property2 |
| Credit unions | Part 723 sets no fixed LTV cap; each credit union's board policy must set LTV limits by collateral type4 |
| Fannie Mae small loans | 80% max LTV5 |
| Freddie Mac Conventional Small | 80% (7-year+ terms); 75% (5 to under 7 years)6 |
| FHA 223(f), market-rate | 87% LTV7 |
| FHA 223(f), cash-out refinance | Greater of 80% LTV or the cost to refinance8 |
| SBA 504 project split | 50% bank first lien, 40% CDC debenture, 10% borrower9 |
Few loans are written at the ceiling. Loans CBRE originated in Q2 2026 averaged 59.6%10 LTV (63.3%10 on multifamily), and 2025 HMDA multifamily filings show a 64.5% median combined loan-to-value11. The ceiling is where a lender can go; DSCR and debt yield usually stop the loan first.
Worked examples
Illustrations, not quotes.
- Purchase. $2,400,000 on a $3,000,000 price with a $3,200,000 appraisal: value used is $3,000,000, so LTV is 80.0%. The extra appraised value does not add loan.
- Construction. $6,000,000 against $2,000,000 of land and $6,000,000 of construction costs is 75.0% LTC. A lender capped at a lower LTC would want more equity before the first draw, not at the end.
Edge cases lenders watch
- Land you already own. Lenders usually credit land at cost or appraised value toward your equity, but the rule varies; ask before you count land appreciation as equity.
- Seller credits and price concessions reduce the effective price, and so the value used for LTV.
- Refinance after a recent purchase. Many lenders still use the purchase price, plus documented improvements, for a period after closing, even if a new appraisal is higher. Expect the question if you bought recently.
- Interest reserve and fees in the budget. Financing them raises both the loan and the cost, so the LTC moves less than you might expect.
Method and formula
purchase: LTV = loan / min(price, appraised value) refinance: LTV = first lien / value; combined LTV = (first + second) / value construction: LTC = loan / (land + hard + soft costs); LTV as complete = loan / completed value largest loan at a limit = basis x limit / 100
Questions people ask
Why does the lender use the purchase price when the appraisal is higher?
Because federal real estate lending guidelines define value on an acquisition as the lower of the two. A high appraisal does not create equity the buyer has not paid for, so it does not raise the loan.
Does a second mortgage count toward LTV?
For the bank’s supervisory test, yes: LTV counts all senior liens, and most lenders also cap combined LTV including any second lien or mezzanine loan. Agency and CMBS loans usually restrict subordinate debt or require it to fit inside a combined limit.
What is the difference between LTC and LTV on a construction loan?
LTC divides the loan by the total cost to build (land plus hard and soft costs). LTV divides it by the appraised value, usually the value once complete. Lenders apply both and lend the smaller result, so a project that creates a lot of value is usually capped by cost.
Can a lender go above the supervisory LTV limits?
Yes, within limits. Banks may make loans above the guideline ceilings, but the total of such commercial loans is capped as a share of the bank’s capital, so lenders keep those exceptions for strong deals.
Related tools and guides
Sources
- 12 CFR Part 34, Subpart D, Appendix A (Interagency Guidelines for Real Estate Lending Policies), eCFR, as of October 29, 2026
- eCFR, 12 CFR Part 365 Appendix A (Interagency Guidelines for Real Estate Lending Policies), as of November 26, 2021
- OCC Comptroller's Handbook, Commercial Real Estate Lending (Version 2.0), as of March 2022
- eCFR, 12 CFR Part 723 (NCUA Member Business Loans; Commercial Lending), as of January 1, 2017
- Fannie Mae Multifamily, Small Mortgage Loan Program Term Sheet, retrieved November 1, 2026
- Freddie Mac Multifamily, Optigo Conventional Small Term Sheet, as of April 2026
- HUD Mortgagee Letter 2025-03, Multifamily Changes in DSCR and LTV/LTC, as of January 8, 2025
- HUD MAP Guide 4430.G (2020 MAP Guide, revision March 2021), as of March 19, 2021
- SBA SOP 50 10 8.1, Lender and Development Company Loan Programs (effective Oct 1, 2026), as of October 1, 2026
- CBRE Lending Momentum Index, Q2 2026 press release (Aug 3, 2026), as of June 30, 2026
- CFPB/FFIEC HMDA 2025 public data, multifamily originations (Data Browser), as of December 31, 2025
How we check figures: methodology and editorial policy.
Get financing for this deal
Send the property and the loan once. A person at Janover Capital LLC reads it, tells you which programs fit and replies, usually within one business day.