How to Refinance a Loan With a High LTV

Your LTV is the loan-to-value of your property. It reflects the relationship of the total loan amount against the value of the property. Your loan to value is determined by dividing your current balance against the appraised value of your property. While it can sometimes pose difficult to refinance a loan with a high loan-to-value ratio, it can be done. Here is your how-to guide on refinancing a loan with a high loan-to-value ratio.

The Appraisal

Prepare your home for an appraisal. Make improvements to your property such as landscaping and all minor repairs prior to getting your appraisal completed. This will ensure that your property appraises for the maximum amount, which will help decrease your LTV ratio.

Hire three appraisers to perform value proposals on your home. These three appraisers should be from different banks in order to have the best possible property appraisal done.

Do your homework. Contact a real estate professional to perform a comparative market analysis (CMA) of your property and compare that against other homes in your area that have been sold recently or are on the market. This will help you with the appraisal process.

Compare the appraisals from each different appraiser against the CMA (comparative market analysis) that your real estate professional performs for you. This will allow you to dispute any negative or low-valued comparable properties that the appraiser found and eliminate them from your report prior to applying for refinancing.

Select the highest and best appraisal to submit to your mortgage company with your application for refinance. Send the market analysis that the real estate professional performed as well along with your paperwork. Oftentimes this will eliminate the bank's need to have a separate appraisal performed.

The Refinance

Apply for your refinance with a bank that is going to give you the best possible rates and terms. Shop lenders and offers against one another to put yourself in a position to negotiate.

Discuss your loan-to-value ratio with your loan officer in detail. Make sure he knows you have done your homework about your LTV and that you are educated about market results. This will help your case in getting an approval for your refinance.

Keep your credit in check. If you need to pay down a few loans and credit cards, do so prior to your loan officer submitting your file to the underwriting department. Your goal is to create the best picture possible on your ability to repay.

Remember that cash is king. If you have anything to put up as collateral or additional available funds to help pay down your principal balance it's wise to do this when applying for your refinance. Keep an available recording of all your liquidated funds, and talk about leveraging your 401K or other investments.

Sign all of the paperwork and get your loan approved. Once your loan is approved you should be able to close on your refinance within two weeks from your loan approval date. You have successfully refinanced your home while carrying a high LTV ratio.


  • Be completely honest with your loan officer about your situation. He wants to help you get a loan approval.