Investor Encyclopedia

LTV

LTV: a practical Canadian real estate investor guide to definition, deal math, underwriting use, common traps, and Realist.ca implementation.

Definition

Loan-to-value is debt divided by property value or purchase price. It measures how much of the asset is financed with debt.

Formula

LTV = loan amount / appraised value or purchase price.

Example

In underwriting, tag LTV beside the exact source input and rerun the model when that input changes. The point is not a pretty metric; it is a better buy, hold, refinance, or walk decision.

Why It Matters

LTV changes what a disciplined buyer can pay, how much debt the asset can safely carry, and whether the return is coming from operations or fragile assumptions.

Investor Interpretation

Debt should make a solid deal more efficient, not hide a weak one. If the asset fails unlevered, leverage usually makes the failure arrive faster.

Realist Tie-In

Realist.ca can make LTV searchable as an encyclopedia entry, link it to property underwriting, and show it beside listings, saved analyses, market pages, and investor lead magnets.