The maximum Loan-to-Value Ratio (LTV) for commercial real estate financing varies depending on the property type, underwriting factors, loan terms, market, etc. Generally, a lower LTV results in more competitive commercial loan terms and rates, whereas a high LTV results in higher risk, and therefore less advantageous loan terms for the borrower. For example, if a property is valued at $1 million and a lender restricts its offer to a 70% LTV, you will be unable to get a loan larger than $700,000.
You can use our Loan-to-Value Ratio Calculator to calculate the LTV for your commercial real estate loan.