Car loan LTV calculator

The CFPB definition

How car loan-to-value is calculated

The Consumer Financial Protection Bureau defines auto loan-to-value as the loan amount divided by the vehicle's actual cash value. Multiplying by 100 expresses the result as a percentage.

A $20,000 loan secured by a vehicle worth $20,000 has 100% LTV. A $15,000 loan on the same value has 75% LTV. A $25,000 loan on that value has 125% LTV, meaning the loan exceeds the vehicle value by $5,000.

Formula and examples: CFPB explanation of auto-loan LTV.

The denominator matters

Vehicle value is not always the purchase price

A negotiated price tells you what the seller will accept. LTV uses the value recognized for the collateral. A lender may rely on a particular valuation guide, wholesale or retail measure, mileage and condition adjustments, equipment, or its own policy. Ask which value was used when comparing your calculation with a lender's result.

Do not improve the result by entering the asking price as “value” unless that is genuinely the value basis being used. A higher entered value mechanically produces a lower LTV.

Build the numerator carefully

Fees and old debt can make the loan exceed the car

In purchase mode, the calculator adds the negotiated vehicle price, financed taxes and fees, optional financed products and the old loan payoff. It then subtracts the cash down payment and trade-in allowance.

This arrangement shows positive or negative trade equity without double counting it. If the old payoff is $12,000 and the trade allowance is $10,000, the net $2,000 gap increases the new loan. The CFPB warns that rolling an unpaid balance into a new loan increases borrowing costs and can extend negative equity.

See the CFPB's guidance on trading a car that is not paid off.

Same vehicle, different borrowing

How cash down changes LTV

More cash down reduces the numerator, but it does not change the vehicle value. Rolling in negative equity, financed add-ons or taxes and fees can increase the numerator above the price and value. The calculator's target field simply shows the loan amount corresponding to a ratio you choose.

Why lenders and borrowers look at LTV

A higher ratio means less collateral coverage

The CFPB explains that lenders use LTV when evaluating an application and that a higher percentage can affect approval, terms and interest rate. For a borrower, an LTV above 100% means the debt exceeds the vehicle value. If the vehicle is totaled, stolen, sold or traded, the insurance settlement or sale proceeds may not cover the entire payoff.

• A larger down payment reduces the amount borrowed.
• A less expensive vehicle may reduce both the requested loan and depreciation exposure.
• Paying old negative equity separately avoids securing old debt with the replacement vehicle.
• Paying principal on an existing loan can lower the numerator, although vehicle value may also decline.

No universal approval cutoff

LTV is one input, not a loan decision

Lenders can use different maximum ratios, vehicle values, credit criteria, income measures, terms and program rules. A ratio alone cannot tell you whether a lender will approve the application or what APR it will offer. The custom target is therefore labeled as your comparison target, not a recommended or guaranteed threshold.

This page also does not estimate monthly payment or total interest. After confirming the amount financed, move those numbers to the payment calculator with the offered APR and term.