What the heck does “loan-to-value” mean?


There are lots of terms we use in the mortgage industry that aren’t part of everyday parlance. Today, I’ll talk a little bit about “loan-to-value”, or LTV for short.

In fact, I have a video that’s less than 90 seconds long if you’re in a hurry:

Loan-to-value

So, just to recap what I said in the video, your loan-to-value is the percentage of your home’s value that you finance with your home loan.

Whether you a purchasing a home, or refinancing your existing mortgage, LTV is an extremely important factor in making an educated decision about your home loan.

I’ll give you an example:

FHA – When purchasing a home using an FHA home loan, you can finance up to 96.5% of the appraised value of the property. If you are refinancing, you have two options: “rate & term” or “cash-out”. Rate & term means you are refinancing to lower your rate or change the length of your loan. A rate & term refinance is capped at a 97.75% LTV for FHA. Cash-out FHA refinances are limited to 85 per cent of the value of your home. If your current mortgage is an FHA loan, you can refinance with an FHA streamline, which does not have an LTV limitation.

So your needs define your loan-to-value, which helps define what home loan program you are going to apply for.

If you would like to learn more about loan-to-value, other mortgage terminology, or home loans in Oregon and Washington, I invite you to visit my site or contact me. I am long on answers and short on sales pitches 🙂

Thanks for taking a minute to read this post!

Picture: Jason HillardJason Hillard – homeloanninjas.com

Mortgage Advisor in Oregon and Washington MLO#119032

Pinnacle Mortgage Bankers

a div of Pinnacle Capital Mortgage Corp

503.799.4112

jason@mypmb.us

1706 D St Vancouver, WA 98663

NMLS 81395 WA CL-81395

Equal Housing Lender

The Boogeyman, Loch Ness Monster, and Custom home loans


I’ve really been on a tear lately when it comes to listening to advertisements from other lenders. It used to really piss me off when I saw misleading, deceptive, or otherwise “BS” mortgage ads.

Now I choose to laugh.

And poke a little fun. Here’s a video I made about the idea of “custom” home loans:

Custom Home Loans – Really?!

Mortgages are not the financial equivalent of an “a la carte” menu.

The investors that buy home loans don’t have short order cooks catering to individual preference.

Home loan programs are basically boxes. Some people offer different boxes, some people have more boxes. Most of these boxes have familiar names – FHA, VA, USDA, Conventional.

It is the job of a Licensed Mortgage Professional to explain all the boxes to you, tell you which ones your situation fits in, and help you devise a plan of action if you don’t immediately fit in the box you want.

If you have questions about  the boxes available to you, I am here to answer all of your questions about Oregon & Washington home loans. There’s a lot of boxes out there, and chances are you fit into one of them.

Picture: Jason Hillard

Jason Hillard – homeloanninjas.com

Mortgage Advisor in Oregon and Washington MLO#119032

Pinnacle Mortgage Bankers

a div of Pinnacle Capital Mortgage Corp

503.799.4112

jason@mypmb.us

1706 D St Vancouver, WA 98663

NMLS 81395 WA CL-81395

Equal Housing Lender