Loan-to-Value Ratio (LTV)

Loan-to-value is the loan amount divided by the asset's value — how much of the purchase the lender is funding. At 80% LTV you have a 20% deposit, which is the threshold where US mortgage insurance usually falls away and rates improve. Lenders price in LTV bands, so crossing from 81% to 79% can cut your rate meaningfully. In a falling market LTV rises without you doing anything, which is how borrowers end up underwater.