Use this calculator to work out the loan-to-value ratio on a South African home loan. Enter your property value and loan amount to see your LTV percentage, the equity you'd hold in the property, and where you sit on the lender risk scale.
If you enter a deposit, it will be subtracted from the loan amount to calculate the net LTV.
| Item | Amount |
|---|
Indicative only. SA banks typically offer up to 100% LTV for qualifying buyers, with lower rates and better terms for LTVs of 80% and below. Excludes bond registration costs, transfer duty, and other property purchase fees.
What is a Loan-to-Value Ratio?
The loan-to-value ratio is the size of your home loan expressed as a percentage of the property's value. It's one of the first numbers a South African bank looks at when assessing a bond application, because it tells them how much of the property they're financing versus how much you're putting in yourself.
The formula is straightforward:
LTV = (Loan amount ÷ Property value) × 100
For example, on a R2 million property with a R1.7 million loan, the LTV is 85%. The remaining 15% (R300,000) is your deposit, and that portion represents your equity in the home from day one.
Why LTV Matters in South Africa
Your LTV directly affects three things: whether your bond is approved, the interest rate you're offered, and the total cost of your home over the life of the loan.
South African banks generally reserve their best interest rates for applicants with an LTV of 80% or lower. Above that threshold, the bank carries more risk if you default — there's less buffer between what you owe and what the property would fetch at a forced sale — so they price that risk into a higher rate. Even a difference of 0.5% on a R1.5 million bond over 20 years can add up to more than R100,000 over the loan term.
It's also worth knowing that the bank uses its own valuation of the property, not the purchase price. If you offer R2 million but the bank values the home at R1.9 million, your LTV is calculated against the lower figure. This is one of the most common reasons applications are unexpectedly declined or come back with a smaller loan than requested.
LTV Bands and What They Mean
| LTV | Risk Band | What to Expect |
|---|---|---|
| 80% or less | Low | Best interest rates, smoothest approval, strongest negotiating position |
| 80% – 90% | Moderate | Competitive rates, generally straightforward approval for qualifying buyers |
| 90% – 100% | Higher | Approval possible for buyers with strong credit and stable income; rates are higher |
| Above 100% | Over-financed | Rare — usually requires additional security or a guarantor |
100% bonds are available in South Africa and are commonly used by first-time buyers, but they come with stricter affordability checks and a higher rate. A larger deposit, even an extra 5%, can move you into a more favourable band.
How to Lower Your LTV
There are two ways to bring your LTV down: increase your deposit or lower the price you're paying. Saving towards a deposit before you start house-hunting gives you the most flexibility, but other options include negotiating the purchase price, choosing a less expensive property, or waiting until your savings have grown. If you're already a homeowner refinancing or accessing equity, paying down the existing bond before reapplying will improve your LTV on the new application.
What This Calculator Doesn't Cover
LTV is one factor in a home loan decision, not the only one. Banks also assess your credit score, debt-to-income ratio, employment stability, and the property type itself. The calculator also excludes the upfront costs of buying property in South Africa — bond registration fees, transfer duty (on properties above R1.21 million as of the 2025/2026 tax year), conveyancer fees, and initiation fees — which you'll need to budget for separately on top of your deposit.
For a binding indication of what you'll qualify for, get pre-approved through a bond originator or directly with a bank. They'll factor in your full financial profile alongside the LTV.