Combined Loan To Value Ratio - CLTV Ratio


DEFINITION of 'Combined Loan To Value Ratio - CLTV Ratio'

A ratio used by lenders to determine the risk of default by prospective homebuyers when more than one loan is used. In general, lenders are willing to lend at CLTV ratios of 80% and above to borrowers with a high credit rating.

Combined Loan To Value Ratio (CLTV Ratio)

BREAKING DOWN 'Combined Loan To Value Ratio - CLTV Ratio'

For example, let's assume that an individual is purchasing property valued at $200,000. This individual takes out two loans for the property, one for $100,000 and another for $50,000. The combined loan to value ratio would be 75%, (($100,000 + $50,000) / $200,000).

  1. Debt-To-Income Ratio - DTI

    A personal finance measure that compares an individual's debt ...
  2. Mortgage

    A debt instrument, secured by the collateral of specified real ...
  3. Mortgage Banker

    A company, individual or institution that originates mortgages. ...
  4. Total Debt Service Ratio - TDS

    A debt service measure that financial lenders use as a rule of ...
  5. Alt-A

    A classification of mortgages where the risk profile falls between ...
  6. Gross Debt Service Ratio - GDS

    A debt service measure that financial lenders use as a rule of ...
Related Articles
  1. Personal Finance

    Understanding Your Mortgage

    We walk through the steps needed to secure the best loan to finance the purchase of your home.
  2. Budgeting

    Mortgages: How Much Can You Afford?

    Answering this means number-crunching as well as factoring in other considerations and expenses.
  3. Home & Auto

    The Benefits Of Mortgage Repayment

    Buying a home may be the biggest debt you'll ever incur. Learn why you should retire it sooner, rather than later.
  4. Home & Auto

    Before you Buy That Home: Find a Great Realtor

    Most people think of a good realtor as a successful salesperson, but we should not assume than that's what makes a great or even a good realtor.
  5. Home & Auto

    How to Rate a Neighborhood When Buying a Home

    From school quality to crime rates, here are the factors to consider before you purchase a home.
  6. Home & Auto

    5 Mistakes to Avoid When Buying a New Home

    Learn about home ownership and some of the pitfalls a potential homebuyer faces. Understand five specific mistakes all homebuyers should avoid.
  7. Home & Auto

    Looking To Invest In Home Improvements?

    Some home improvement projects could cost you more to complete than they’ll pay out in equity. So, here we show you the worst projects to avoid.
  8. Home & Auto

    Are Home Inspections Worth It? - Price vs. Value

    If you’re wondering whether home inspection is worth the investment, the following information will help you decide.
  9. Home & Auto

    Low-Cost Curb Appeal Projects For Your Front Yard

    Some low-cost improvements to your home's exterior and front yard could increase its curb appeal and ensure a great first impression on buyers.
  10. Home & Auto

    Swimming Pools: Costs Vs. Long-Term Value

    Consider the costs of installing and maintaining a swimming pool, and compare this with the pool's utility and the market value it adds to your home.
  1. What is a combined loan to value ratio?

    The combined loan to value (CLTV) ratio is a calculation used by mortgage and lending professionals to determine the total ... Read Full Answer >>
  2. What are the advantages of using a home-equity debt consolidation loan?

    When the interest charges from outstanding balances on credit cards and loans start to add up, it is difficult to make any ... Read Full Answer >>
  3. Who are the best-rated home insurance companies in the US?

    Based on consumer surveys, the best company for homeowners insurance in 2014 is Amica Mutual. Present and past insurance ... Read Full Answer >>
  4. How can I tell when a real estate agent might be lying to me?

    Real estate agents are likely to lie or fudge the details about their own credentials, the value and condition of a property ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Capitalization Rate

    The rate of return on a real estate investment property based on the income that the property is expected to generate.
  2. Gross Profit

    A company's total revenue (equivalent to total sales) minus the cost of goods sold. Gross profit is the profit a company ...
  3. Revenue

    The amount of money that a company actually receives during a specific period, including discounts and deductions for returned ...
  4. Normal Profit

    An economic condition occurring when the difference between a firm’s total revenue and total cost is equal to zero.
  5. Operating Cost

    Expenses associated with the maintenance and administration of a business on a day-to-day basis.
  6. Cost Of Funds

    The interest rate paid by financial institutions for the funds that they deploy in their business. The cost of funds is one ...
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!