The loan-to-value (LTV) ratio is a financial term used by lenders to express the ratio of a loan to the value of an asset purchased.

The LTV ratio is a lending risk assessment ratio that financial institutions and others lenders examine before approving a mortgage. Typically, assessments with high LTV ratios are seen as higher risk and cost the borrower more.

To calculate an LTV ratio, divide the amount of a loan by the total value of the asset securing the loan, expressed as a percentage.