What is LTV (Loan-to-Value)?
LTV (Loan-to-Value) is the ratio between the loan amount and the property value. It is one of the main indicators banks use to assess risk and set mortgage conditions.
What does LTV mean?
LTV expresses how much you are borrowing relative to the property value, as a percentage. An LTV of 80% means the bank finances 80% of the property value, and you contribute 20% as a down payment. The lower the LTV, the lower the risk for the bank, which can lead to better loan conditions.
How is it calculated?
The formula is straightforward: LTV = (Loan Amount / Property Value) × 100. For example, if the property is worth 1,500,000 MDL and you put down 300,000 MDL, the loan amount is 1,200,000 MDL, and LTV = (1,200,000 / 1,500,000) × 100 = 80%.
LTV limits in Moldova
The standard limit for conventional mortgages at most Moldovan banks.
The state programme Prima Casă allows a higher LTV, making it accessible for young people and families with a smaller deposit.
Some banks may accept a higher LTV with additional collateral or under special conditions.
Possible for refinancing loans or when using existing property as security, at certain banks.
Example
Property: 1,500,000 MDL. 20% down payment = 300,000 MDL. Loan: 1,200,000 MDL. LTV = 80%. If you increase the deposit to 25% (375,000 MDL), the loan drops to 1,125,000 MDL and LTV becomes 75% — which may unlock a lower interest rate at some banks.
Tip
An LTV below 80% improves your chances of approval and may reduce your interest rate. If you can put down a larger deposit, it is worth calculating the difference in total loan cost.