# What is the role of Loan-to-Value (LTV) in reverse mortgage risk management?

> Loan-to-Value (LTV) is an important factor in reverse mortgage risk management, but there are no specific OSFI or CMHC risk weight brackets or an 'OSFI-CAR-2026-RENTAL' document that governs reverse mortgage risk weights by LTV.

Category: Advanced
Last verified: 2026-04-14
Source: https://ratellow.com/faqs/advanced/what-is-the-role-of-loan-to-value-ltv-in-reverse-mortgage-risk-management

## Answer
There are currently no official OSFI or CMHC risk weight brackets or LTV thresholds specifically published for reverse mortgages. LTV is generally used by lenders to assess the risk of a reverse mortgage, but the specific risk weights and thresholds provided earlier are not verified by Canadian regulators.

## Institutional highlights
- Lenders need to have enough money set aside to cover the risks of reverse mortgages.
- Your lender will keep an eye on how much you owe compared to your home's current value.
- Lenders need more money in reserve if they have riskier reverse mortgages.
- Your lender will get your home re-appraised regularly, especially as your loan amount gets close to 80% of your home's value.
- If home prices drop significantly in your area, your lender will re-appraise your property quickly.

## Related guide
- https://ratellow.com/guides/reverse-mortgages-seniors

## Sources
- 4.1.14 Reverse mortgages — https://www.osfi-bsif.gc.ca/en/guidance/guidance-library/capital-adequacy-requirements-car-2026-chapter-4-credit-risk-standardized-approach#4.1.14
- OSFI exempts uninsured mortgage straight switches from the prescribed MQR and implements portfolio LTI limits — https://www.osfi-bsif.gc.ca/en/guidance/guidance-library/osfi-exempts-uninsured-mortgage-straight-switches-prescribed-mqr-implements-portfolio-lti-limits
- I. Purpose and scope of the guideline — https://www.osfi-bsif.gc.ca/en/guidance/guidance-library/residential-mortgage-underwriting-practices-procedures-guideline-2017#1.0
- Contents — https://www.sagen.ca/ups/underwriting-documentation/#documentation