# Loan to Value (LTV)

Notional is an overcollateralized lending protocol. This means that the maximum amount you can borrow is less than the total value of your collateral. \
\
Your Loan to Value (LTV) is the value of your loan in USD divided by the value of your collateral in USD.

$$
LTV = loanValue / collateralValue
$$

For example, if you borrowed 100 USDC against 200 USDC worth of ETH, your LTV would be 50%.

```
// Example LTV calculation

loan value = 100 USDC
collateral value = 200 USDC

LTV = 100 / 200 = 0.5
```

### Max LTV

The maximum amount you can borrow against your collateral is called the Max LTV. If the Max LTV was 75%, you could borrow another 50 USDC before you would reach your max borrow capacity.

```
// User at Max LTV of 75%

loan value = 150 USDC
collateral value = 200 USDC

LTV = 150 / 200 = 0.75
```

Your Max LTV depends on what assets you're using as collateral, what you're borrowing, and Notional's risk parameters.