If you are looking to borrow against property as a business owner or investor, one number matters more than almost any other: your loan-to-value ratio, or LVR. It determines how much you can access, what security is acceptable, and whether a deal is viable at all. Yet many borrowers approach lenders with only a vague idea of how LVR works in practice, particularly outside the traditional banking system.
This guide explains how LVR functions in non-bank business lending, what caps apply at Strive Financial, and how you can position your application to make the most of the equity you hold.
What Is LVR and Why Does It Matter?
Loan-to-value ratio is the amount you want to borrow expressed as a percentage of the value of the security property. If you own a property worth $1,000,000 and you want to borrow $600,000 against it, your LVR is 60%.
For lenders, LVR is a measure of risk. The lower the LVR, the more equity sits between the lender and a potential loss if the loan cannot be repaid. For borrowers, understanding LVR helps you work out how much you can realistically access and whether the property you intend to offer as security will support the loan amount you need.
How Strive Financial Assesses LVR
Strive Financial uses a straightforward set of LVR caps, applied consistently regardless of whether the property is in a capital city or a regional area.
Residential Property
Up to 70% LVR. This applies to standard residential homes, residential land, and most mixed-use properties with a residential component.
Industrial Property
Up to 60% LVR. Warehouses, factories, and similar industrial assets fall into this category.
Commercial Property
Up to 50% LVR. Retail, office, and general commercial premises are assessed at this lower cap, reflecting the typically wider variability in commercial property values and liquidity.
These caps apply to the current, as-is market value of the security. Valuations are conducted on the basis of what the property is worth right now, not what it might be worth after works are completed or tenants are secured.
What About Second Mortgages?
Strive Financial considers both first and second mortgage positions. A second mortgage sits behind an existing first mortgage held by another lender. In this scenario, the combined LVR of both mortgages is what matters for assessment purposes.
For example, if your property is worth $1,000,000, your existing first mortgage balance is $400,000, and you want to borrow a further $250,000 from Strive in second mortgage position, the combined borrowing is $650,000, giving a combined LVR of 65%. Whether that works depends on the security type and whether it falls within the applicable cap.
Strive generally does not lend behind private lenders. Where there is already a non-bank lender in first mortgage position, this is assessed on a case-by-case basis.
LVR Is One Part of the Assessment, Not the Whole Story
A common misconception is that meeting the LVR threshold is all that is needed to get a loan approved. In reality, LVR is one factor in a broader assessment. At Strive Financial, every deal is evaluated across four areas: the purpose of the loan, the exit strategy, the security, and the loan amount.
Purpose
All lending is for business or investment purposes. The reason you need the funds needs to make commercial sense.
Exit Strategy
Every loan needs a credible plan for repayment. This could be a refinance with another lender, the sale of a property or another asset, or incoming funds from a known source. The exit does not need to be guaranteed, but it does need to be realistic and explained clearly.
Security
The property offered as security needs to support the loan amount at the applicable LVR cap. The condition, location, title type, and marketability of the property all factor into the assessment. Strive has lent across a wide range of property types and does not apply hard exclusions, though each deal is considered individually.
Loan Amount
Loans range from $25,000 to $2,000,000. The amount needs to be proportionate to the security and consistent with the stated purpose.
How to Maximise the Equity You Can Access
If you want to borrow as much as possible against your property, there are a few things that can strengthen your position.
- Use residential property where possible. The 70% LVR cap on residential security is the highest available, meaning you can access more equity from a residential asset than from commercial or industrial property of the same value.
- Know your current property value. Valuations are based on current as-is market value. Having a realistic, up-to-date sense of what your property is worth helps you understand what loan amount is likely to be supported before you apply.
- Have a clear exit strategy. A well-articulated, credible exit plan makes the overall deal stronger, even where the LVR is at or near the cap.
- Consider multiple security properties. If one property alone does not support the loan amount you need, offering additional security may allow a larger facility.
Get a Fast Decision Without the Bank Runaround
Understanding LVR before you approach a lender puts you in a much stronger position. You can quickly assess whether the equity you hold is likely to support the funding you need, and you can structure your application accordingly.
Strive Financial offers property-backed term loans and lines of credit from $25,000 to $2,000,000, with no credit checks, no financials required, and no upfront fees. Decisions are made quickly, and funding can be available within 24 hours on the right deal.
Security is one part of the picture. Purpose, exit, and loan amount matter just as much. Strive assesses every deal as a whole, not just the numbers on a valuation report.
If you want to understand exactly how much equity you could access from your property, get in touch with the Strive team today, or apply online and get the process started.