The ratio of your mortgage amount to the appraised value of the property.
LTV is calculated as (mortgage amount / property value) x 100. For example, a $400,000 mortgage on a $500,000 property is 80% LTV. In Canada, if your LTV is above 80% (meaning your down payment is less than 20%), you must purchase mortgage default insurance (CMHC, Sagen, or Canada Guaranty). The maximum LTV for insured mortgages is 95% (5% minimum down payment). Private lenders typically cap LTV at 75-80%.
Related terms: CMHC Mortgage Insurance | Down Payment | Private Mortgage