LTV Ratio
Loan-to-Value ratio — the percentage of the property value that a lender will finance.
Apply for a LoanWhat is LTV Ratio?
Loan-to-Value (LTV) ratio is the maximum percentage of the property's assessed market value that a lender is willing to finance as a loan. The remaining percentage is the borrower's down payment (margin). RBI sets maximum LTV limits for home loans: up to 75% for loans above ₹75 Lakh, up to 80% for ₹30–75 Lakh, and up to 90% for loans below ₹30 Lakh. Higher LTV = less down payment required but higher EMI.
Example
Property value: ₹80 Lakh. At 75% LTV (RBI max for >₹75L loans): maximum loan = ₹60 Lakh, down payment = ₹20 Lakh. If the same property is assessed at ₹50 Lakh: at 80% LTV, maximum loan = ₹40 Lakh, down payment = ₹10 Lakh.
Frequently Asked Questions
What is the maximum LTV for home loans per RBI guidelines 2025?
RBI maximum LTV ratios for home loans: up to ₹30 Lakh — 90% LTV (10% down payment); ₹30–75 Lakh — 80% LTV (20% down payment); above ₹75 Lakh — 75% LTV (25% down payment). These are maximums — individual lenders may offer lower LTV based on borrower profile, property location, and type (under-construction properties often get lower LTV than ready properties).
How is LTV calculated for construction loans?
For construction loans, LTV is calculated on the total project cost: plot value + construction cost (as per approved estimate). Example: plot value ₹20 Lakh + construction estimate ₹40 Lakh = total project ₹60 Lakh. At 80% LTV: maximum loan = ₹48 Lakh. The remaining ₹12 Lakh is your down payment. Lenders disburse the loan in stages as construction progresses, not as a lump sum.
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