1. SkipCarDealer
  2. Glossary
  3. In BC, what should I know about loan-to-value (LTV) for car loans?
In BC, what should I know about loan-to-value (LTV) for car loans?
Open Your Account
Car Loan Glossary • bc

In BC, what should I know about loan-to-value (LTV) for car loans?

In BC, Loan-to-Value (LTV) for a car loan is the ratio of the loan amount to the vehicle's established market value, a crucial metric lenders use to assess risk and determine financing terms. While there are no specific BC provincial regulations dictating LTV caps, lenders across Canada typically set internal limits, often ranging from 100% for used vehicles to 120% or even 130% for new cars, allowing for the inclusion of taxes, warranties, and accessories for well-qualified buyers. Looking ahead to 2025, with potential economic shifts and continued volatility in used car values, lenders may adopt more conservative LTV thresholds, particularly for older or higher-mileage vehicles. This matters significantly to you as a consumer because a higher LTV signals greater risk, potentially requiring a larger down payment, resulting in a higher interest rate, or even leading to loan denial. Understanding LTV helps you avoid negative equity, where you owe more than the car is worth, and ensures you're prepared for the financial commitment, as lenders will rely on industry valuation guides like Canadian Black Book or Red Book to determine the vehicle's fair market value.

References:

Related Topics: bc province topic

Related Financial Terms

Is it possible to I repay a car loan early?

Yes, it is generally possible and often financially beneficial to repay a car loan early i...
What is the two‑thirds rule in BC?

In British Columbia, the 'two-thirds rule' is a crucial consumer protection enshrined with...
Explain the two‑thirds rule in BC?

The two-thirds rule in British Columbia is a significant consumer protection enshrined wit...
What is the two‑thirds rule in BC in Canada?

The "two-thirds rule" in British Columbia is a significant consumer protection measure ens...

Need more help?

Explore our full glossary or get in touch with our financing experts.

View Full Glossary
Search Glossary
Type a keyword and hit enter
Browse by Letter
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
Popular Terms

Ready to get approved?

Skip the dealership hassle and get pre-approved for your car loan today.

Apply Now

With over 50 years of experience in the automotive industry, we know what we're doing when it comes to getting the best deals. We specialize in credit building and rebuilding, and with our expertise, we're sure to find a solution that suits you! Its our Skip Car Dealer Guarantee.

Credit Solutions

Loan Types

Programs

Partners

155-2 King Street West, Unit #107, Hamilton, ON, L8P 4S0 888-270-SKIP (7547)

PARTICIPATING LENDERS MAY VERIFY YOUR SOCIAL INSURANCE NUMBER, DRIVER'S LICENSE NUMBER, PROVINCIAL ID, OR ANY OTHER GOV IDENTIFICATIONS AND REVIEW YOUR INFORMATION AGAINST FEDERAL DATABASES TO INCLUDE BUT NOT LIMITED TO EQUIFAX, TRANSUNION, AND EXPERIAN TO DETERMINE CREDIT WORTHINESS, CREDIT STANDING AND/OR CREDIT CAPACITY. BY SUBMITTING YOUR APPLICATION AND INFORMATION ON THIS WEBSITE, YOU AGREE TO ALLOW ANY AND ALL PARTICIPATING LENDERS TO VERIFY YOUR INFORMATION AND CHECK YOUR CREDIT. SKIP CAR DEALER FOLLOWS BEST PRACTICES OF THE CANADIAN FAIR TRADING ACT OF 1999. ALL FINANCE IS SUBJECT TO EMPLOYMENT STATUS AND INCOME. APPLICANTS MUST BE 18 OR OVER, TERMS AND CONDITIONS APPLY, GUARANTEES AND INDEMNITIES MAY BE REQUIRED. WE CAN INTRODUCE YOU TO A NUMBER OF FINANCE PROVIDERS BASED ON YOUR CREDIT RATING. WRITTEN QUOTATION ON REQUEST.

This site uses cookies so that we can provide you with the best user experience. By continuing to use the site you are consenting for cookies to be used. Further information on cookies and how you can disable them is available on our cookie policy.

Copyright © 2020 Skip Car Dealer All Rights Reserved.

Terms of use | Privacy Policy

Top