Commercial LTV Calculator

Commercial LTV uses the lower of appraised or purchase price. This is the rule that trips up new borrowers — if you bought a property for 10M but it appraised at 9.5M, the lender sizes LTV on 9.5M, not 10M. This calculator applies that rule and returns max loan, equity required, and whether the requested loan fits.

Loan amount

Appraised value

Lender maximum LTV

Purchase price (if different)

LTV on lower of appraised/price

70.59%

Max loan at lender max LTV

$5,950,000

Minimum equity required

$2,550,000

Loan gap above max

$50,000

Within LTV limit

How the math works

Commercial LTV sizes off the lower of appraised value or purchase price. Max LTVs by asset: multifamily 75-80%, office/retail 65-70%, industrial 70-75%, hotels 60-65%. This calculator computes actual LTV on both bases, max loan, and equity required.

Lenders get conservative at higher LTVs — 75% LTV often requires guarantor recourse that 65% LTV doesn't. Balance LTV against DSCR and debt yield — whichever sizes lower binds the loan.

How to Use

Enter loan amount, appraised value, and purchase price.
Enter lender maximum LTV.
Read actual LTV, max loan, and equity required.

Frequently Asked Questions

Why lower of appraised/price?

Protects the lender from overpayment. If you pay 10M for a 9M property, the lender sizes on 9M because the property won't support 10M on re-sale. Equity has to make up the gap.

Max LTV by asset?

Bank multifamily: 75-80%. Agency multifamily (Fannie/Freddie): up to 80%. Office/retail: 65-70%. Industrial: 70-75%. Self-storage: 70-75%. Hotels: 60-65%.

LTV vs LTC?

LTV is value-based. LTC (loan-to-cost) is cost-based (purchase + rehab + closing). Construction and value-add lenders use LTC; stabilized purchase loans use LTV.