Calculating your loan-to-value ratio is straightforward once you know the Loan to Value formula and what each input means. This guide explains the method in plain language, walks through a manual calculation, and gives worked examples you can follow — then you can do it instantly with the Loan to Value Calculator.
What is Loan to Value?
The Loan to Value calculation tells you your loan-to-value ratio from a few simple inputs. The figure you are solving for here is the loan-to-value ratio, expressed in percent.
The Loan to Value formula
The core formula is:
Loan-to-value ratio = Loan amount ÷ Property ÷ asset value × 100Here is what each input means:
- Loan amount — a money amount. Example: ₹40,00,000.
- Property / asset value — a money amount. Example: ₹50,00,000.
How to calculate it step by step
- Write down the loan amount (for example, ₹40,00,000).
- Write down the property / asset value (for example, ₹50,00,000).
- Apply the formula above to get your loan-to-value ratio.
- Double-check the result with the Loan to Value Calculator.
Worked examples
Example 1
| Input / Output | Value |
|---|---|
| Loan amount | ₹40,00,000 |
| Property / asset value | ₹50,00,000 |
| Loan-to-value ratio | 80.00% |
| Your equity / down payment | ₹10,00,000 |
With loan amount of ₹40,00,000 and property / asset value of ₹50,00,000, the loan-to-value ratio works out to 80.00%.
Example 2
With loan amount of ₹80,00,000 and property / asset value of ₹50,00,000, the loan-to-value ratio works out to 160.00%.
| Result | Value |
|---|---|
| Loan-to-value ratio | 160.00% |
| Your equity / down payment | -₹30,00,000 |
Example 3
With loan amount of ₹20,00,000 and property / asset value of ₹50,00,000, the loan-to-value ratio works out to 40.00%.
| Result | Value |
|---|---|
| Loan-to-value ratio | 40.00% |
| Your equity / down payment | ₹30,00,000 |
Tips for an accurate result
- Keep your units consistent — mixing, say, months with years or grams with kilograms is the most common source of error.
- Round only at the very end. Rounding inputs early can shift the final answer noticeably.
- Re-run the numbers whenever an input changes, rather than estimating from an old result.
- Annual rates must be converted to the period you are calculating for (for example, divide an annual rate by 12 for a monthly figure).
Prefer not to do the maths by hand? — the Loan to Value Calculator does it instantly, for free, with the formula and a worked example built in.
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