The LTV ratio based on the original property value takes your current principal balance into consideration when compared to your original property value. For example, if your principal balance is currently $80,000 and the original property value was $100,000, then your current LTV ratio based on the original property value is:
Current Principal Balance / Original Property Value = $80,000 / $100,000 = 80.0%
An LTV ratio based on a new appraisal considers increases in property value that may have been realized since the loan was originated. For example, if your principal balance is currently $80,000 and the home you originally bought for $100,000 has increased in value to $122,000, your current LTV ratio based on the property’s new appraised value is:
Current Principal Balance / New Appraised Value = $80,000 / $122,000 = 65.5%
To determine your current property value, you may purchase an appraisal through an SFN approved appraiser.