LTV

The Loan-to-Value ratio is the percentage of a pledged asset's market value that a lender is willing to finance. For a ₹1 crore home, an 80% LTV loan means the bank funds ₹80 lakh and you put down ₹20 lakh of your own money plus stamp duty, registration, and processing fees. LTV directly controls your required down payment, so it is the second-most important affordability number after your EMI.

RBI sets ceiling LTVs for home loans by bracket: 90% for loans up to ₹30 lakh, 80% between ₹30 and ₹75 lakh, and 75% above ₹75 lakh. Gold loans are capped at 75% LTV per RBI rules (relaxed temporarily to 90% during COVID). Auto loans typically run 80–90% LTV; unsecured loans have no LTV since there is no collateral. If house prices drift down, your effective LTV rises — which matters at refinance or top-up time.

A lower LTV usually earns you a better interest rate, since lenders price risk by equity cushion. It also exempts you from private mortgage insurance in jurisdictions that require it (US PMI, Australian LMI, Canadian CMHC).

Our home loan EMI calculator lets you toggle LTV and see the combined effect on down payment, EMI, and total interest outgo.