Loan-to-value (LTV) calculator.
LTV is loan divided by value — one of the two levers (with DSCR) that sets your maximum commercial loan. Check where a deal lands, and see the biggest loan common lender thresholds allow.
How LTV caps your loan
Loan-to-value is one of the two levers, alongside DSCR, that caps a commercial loan. It is the loan amount divided by the property’s value or price. Most lenders top out around 65–75% for stabilized assets, meaning you bring 25–35% equity. Because DSCR and LTV both constrain the loan, the lender advances the lower of the two.
Example. On a $2,720,000 purchase, a 70% LTV allows a maximum loan of $1,904,000, leaving about $816,000 of equity before closing costs. If the property’s income only supported a $1,700,000 loan at the required DSCR, that lower figure would govern — and your down payment would rise accordingly.
Frequently asked questions
LTV against which value?
The appraisal decides your proceeds, not the purchase price, and the two diverge more often than buyers expect. Send me the property and I'll tell you where an appraiser is likely to land.
Estimates are for planning only and use simplified assumptions — not tax, legal, or investment advice. Verify with your lender, CPA, and a full broker analysis before acting.
Against which value, exactly?
Loan-to-value sounds simple until you ask what value means. Lenders lend against the appraised value, not the purchase price, and when the appraisal comes in below the contract the difference is yours to fund in cash.
That gap is common enough to plan for. Appraisers work from recorded comparable sales, and in a market where volume has fallen about 46% since 2021 there are fewer recent comps to work from — which tends to make appraisals lag a rising market rather than lead it.
LTV is rarely the constraint that binds
A lender sizes to the lowest of loan-to-value, debt service coverage and debt yield. LTV governs when income is strong relative to price and rates are low. As rates rise, coverage and debt yield tighten while LTV stays where it is, so buyers who budgeted equity against an LTV assumption find themselves short.
Work out which test binds before you write an offer, not after your loan application. If it is coverage or debt yield, a better rate will not help and only more income or a smaller loan will. I am a broker rather than a lender, but I can point you at the lenders quoting your asset type now.
Common questions
What LTV can I get on commercial property?
It depends on asset type, tenant quality, the lender and the market, and it is only one of three sizing tests. The lender lends against appraised value rather than purchase price, so the effective figure can be lower than the headline ratio suggests.
What happens if the appraisal comes in low?
The loan is sized against the lower value and the shortfall becomes additional equity. Options are renegotiating the price, funding the gap, challenging the appraisal with better comparables, or finding a lender using a different valuation approach.
Is LTV or DSCR more important?
Whichever produces the smaller loan. Lenders size to the lowest of LTV, DSCR and debt yield. In low-rate markets LTV usually binds; as rates rise coverage and debt yield take over.
Tools: deal analyzer · DSCR · IRR · all calculators · Justin Crow, South Florida commercial broker