Combined loan-to-value (CLTV)
CLTV · CLTV ratioA combined loan-to-value ratio, or CLTV, is the total of every loan secured by a property divided by the property's value, as a percent. Lenders cap it when sizing a HELOC or a second mortgage, and the room under the cap is what they may lend.
What is a combined loan-to-value ratio?
Loan-to-value (LTV) counts the first mortgage only. CLTV adds every other lien on the home, a HELOC or a second mortgage, so it is the number that matters once there is more than one loan. Fannie Mae's CLTV counts the drawn portion of a HELOC; its HCLTV ratio counts the full amount of any HELOC, whether or not funds have been drawn.
The ratio and the cap are different things. The ratio is where the home stands today. The cap is the lender's ceiling, and the gap between them, in dollars, is the HELOC capacity.
CLTV is the mirror of the owner's share. A home at 67% CLTV is 33% owned.
How a combined loan-to-value ratio works, with numbers
A home worth $600,000 carries a $380,000 mortgage and a $20,000 HELOC balance, so $400,000 of debt is secured by it. Its CLTV is 66.7%.
Under an 85% cap the secured debt can reach $510,000, so $110,000 more could be borrowed against it, subject to the lender's own appraisal and underwriting.
- Mortgage balance
- $380,000
- HELOC balance
- + $20,000
- Secured debt
- $400,000
- Home value
- ÷ $600,000
- CLTV
- 66.7%
Why a combined loan-to-value ratio matters
The cap decides how much a home can support in borrowing, and the ratio moves without any borrowing at all: a rise in the home's value lowers it, a fall raises it. Under Regulation Z a lender may freeze or reduce a HELOC when the home's value declines significantly below its appraised value, which is the same ratio seen from the lender's side.
The value in the ratio is the lender's appraisal, not the owner's estimate, so a figure worked at home is a guide to what a lender might say rather than the answer.
Combined loan-to-value (CLTV) in Taiga Finance
Taiga Finance shows no CLTV ratio, lender's cap or borrowing figure. It shows the ratio's other half: the property's “Equity share” ring gives the equity as a percent of the home's value, and the Real estate list shows each property's percent “owned”; for a home above water, 100 minus either is the CLTV.
The equity behind that share is the home's value minus every loan linked to it, a mortgage and a HELOC alike, so it moves as the value changes, the mortgage is paid down or the line's balance changes.
Tracking a HELOC, in the help center →Key takeaways: Combined loan-to-value (CLTV)
- CLTV is every loan secured by a home, added up and divided by the home's value.
- LTV counts the first mortgage only; CLTV adds the HELOC and any second mortgage.
- The lender sets the CLTV cap when sizing a HELOC.
- The dollars between the current ratio and the cap are the HELOC capacity.
Questions about Combined loan-to-value (CLTV)
What is CLTV?
Combined loan-to-value: the sum of every loan secured by a property divided by its value. A $600,000 home with $400,000 of secured debt is at 66.7% CLTV. It differs from LTV, which counts the first mortgage alone.
How does CLTV set HELOC capacity?
The lender's cap times the home's value gives the most secured debt the home can carry. Subtracting the debt already on it leaves the capacity. At 85%, the $600,000 home above supports $510,000, so $110,000 remains.
Does Taiga Finance show a property's CLTV?
Not as a ratio. A property's page shows its “Equity share”, the equity as a percent of the home's value; for a home above water, 100 minus that share is the CLTV. Taiga Finance applies no lender's cap and shows no borrowing figure.