Understanding 75% LVR
A 75% loan-to-value ratio means the loan represents 75% of a property's value. Learn how to calculate 75% LVR and understand what it means for loan amounts, deposits, equity and refinancing.
What does 75% LVR mean?
LVR compares a loan amount with the value of the property securing the loan.
A 75% loan-to-value ratio
A 75% LVR means the loan amount is equal to 75% of the property's value.
The remaining 25% represents the mathematical difference between the property's value and the loan amount.
For example, a property valued at $500,000 with a $375,000 loan has an LVR of 75%.
75% LVR Formula
To calculate a loan amount at a target LVR of 75%, multiply the property value by 0.75.
How is 75% LVR calculated?
Once you know the property value and loan amount, calculating LVR is straightforward.
Divide the loan amount by the property value and multiply by 100:
Calculate the loan amount at 75% LVR
Enter a property value to see the corresponding 75% loan amount and 25% difference.
How much is a 75% loan?
At a target LVR of 75%, the loan amount is 75% of the property value.
The remaining 25% is the mathematical difference between the property value and loan amount.
This calculation is illustrative and does not indicate lending approval or borrowing capacity.
75% LVR examples by property value
The LVR remains 75%, while the corresponding loan amount changes with the property value.
| Property Value | 75% Loan | 25% Difference |
|---|---|---|
| $300,000 | $225,000 | $75,000 |
| $400,000 | $300,000 | $100,000 |
| $500,000 | $375,000 | $125,000 |
| $600,000 | $450,000 | $150,000 |
| $750,000 | $562,500 | $187,500 |
| $1,000,000 | $750,000 | $250,000 |
What does 75% LVR mean for a deposit?
At a 75% LVR, the loan represents 75% of the property's value and the mathematical difference is 25%.
Example property value.
75% of the property value.
25% of the property value.
In a simplified calculation, the difference at 75% LVR is 25% of the property value. However, this should not automatically be treated as the complete cash required to purchase a property. Taxes, legal costs, valuation charges, insurance, lender fees and other expenses may also apply.
Explore Deposit Calculations →75% LVR and equity
If the outstanding loan equals 75% of the property's current value, the mathematical difference is 25%.
Suppose a property is currently valued at $500,000 and the outstanding loan balance is $375,000.
In this simplified example, the difference represents 25% of the property's value.
Calculate Your Equity →Equity can change over time
Equity depends on the relationship between the property's current value and outstanding debt.
If the property value changes or the loan balance is reduced, the resulting LVR and equity position can change.
Use a current property value and current loan balance when calculating an updated position.
75% LVR when refinancing
A proposed refinance loan can also be expressed as an LVR based on the property's current value.
Example
If a property is valued at $800,000 and the proposed new loan is $600,000:
Refinancing is more than an LVR calculation
A 75% LVR describes the relationship between a proposed loan and property value. It does not guarantee refinance approval, pricing, fees or any particular lending outcome.
Compare Refinance LVR →Is 75% LVR considered a good LVR?
Whether a 75% LVR is suitable depends on the borrower's circumstances, property, loan and applicable lending criteria.
A 75% loan position
At 75% LVR, the loan represents 75% of the property's value, while the mathematical difference between the two figures is 25%.
It provides a useful reference point when comparing different LVR levels.
LVR is only one factor
Lenders may consider income, expenses, credit history, loan type, property characteristics, debt levels and other applicable criteria.
75% LVR compared with other levels
Comparing LVR percentages helps show how the corresponding loan amount changes for the same property value.
Related LVR guides
Explore the fundamentals behind loan-to-value calculations and related property finance concepts.
Key terms related to 75% LVR
Learn the terminology commonly used when discussing LVR, property value and borrowing.
75% LVR FAQs
What does 75% LVR mean?
A 75% LVR means the loan amount is equal to 75% of the property's value. The mathematical difference between the property value and loan amount is 25%.
What is 75% LVR on a $500,000 property?
A 75% LVR on a $500,000 property corresponds to a $375,000 loan because $500,000 × 0.75 equals $375,000.
What is the deposit for a 75% LVR?
In a simplified calculation, a 75% loan means the mathematical difference is 25% of the property value. Actual cash required to complete a purchase may be different because taxes, fees and other costs can apply.
What is the difference between 70% and 75% LVR?
At 70% LVR, the loan represents 70% of the property's value. At 75% LVR, it represents 75%. For the same property value, a 75% LVR therefore corresponds to a larger loan amount.
How much equity is represented by 75% LVR?
If the outstanding loan produces a 75% LVR, the mathematical difference between the loan and property value is 25% of the property value. Actual equity should be calculated using the current property value and outstanding loan balance.
Can I refinance at 75% LVR?
A proposed refinance loan can have a 75% LVR if the new loan amount equals 75% of the property's current value. Whether refinancing is available depends on applicable lending criteria and individual circumstances.
Is 75% LVR better than 80% LVR?
A lower LVR means the loan represents a smaller percentage of the property's value. However, whether one LVR is more suitable depends on the borrower's circumstances, lender criteria, loan terms and other factors.
What is your current LVR?
Enter your property value and loan amount to calculate your current loan-to-value ratio.
Calculate My LVR →