📌 Key Takeaway: Most lenders cap combined loan-to-value (CLTV) at 80-90% of your home's appraised value — subtract your remaining mortgage balance from that cap to find your maximum available equity to borrow.
The CLTV Formula
Combined loan-to-value = (existing mortgage balance + new loan amount) ÷ home value. If your lender caps CLTV at 85% and your home appraises for $450,000, your total debt against the home can't exceed $382,500.
Worked Example
| Item | Amount |
|---|---|
| Home value | $450,000 |
| 85% CLTV limit | $382,500 |
| Current mortgage balance | $250,000 |
| Maximum new borrowing | $132,500 |
Factors That Can Reduce Your Limit
- A lower credit score often means a lower maximum CLTV, not just a higher rate.
- Some lenders cap CLTV lower (e.g., 80%) for investment properties versus primary residences.
- A recent appraisal showing lower value than expected reduces your available equity directly.
This page is for educational purposes and isn't personalized financial or tax advice. Figures, rates, and program details change frequently — confirm current terms directly with lenders, tax professionals, or the IRS before acting.