It’s actually very straighforward to work out the LVR of your home loan. It is simply the amount borrowed divided by the value of the property being used as security for the loan and then it’s expressed as a percentage (we always multiply by 100).
Let’s look at a quick example below and then we’ll explain the difference in the calculations for purchasing and refinancing.
If we wanted to borrow say $450,000 and the value of the property that we are using is worth $500,000 then our LVR is:
$450,000 ÷ $500,000 = .9 (and then we multiply by 100 to get a %). So our LVR is 90%.