If a loan amount is $420,000 and the appraised value is $600,000, what is the LTV ratio?

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Multiple Choice

If a loan amount is $420,000 and the appraised value is $600,000, what is the LTV ratio?

Explanation:
LTV ratio is the loan amount divided by the property’s appraised value (or purchase price, whichever is lower). Here, 420,000 divided by 600,000 equals 0.7, which is 70%. So the LTV in percentage form is 70%, the best match among the options. (If written as a decimal, it’s 0.70.)

LTV ratio is the loan amount divided by the property’s appraised value (or purchase price, whichever is lower). Here, 420,000 divided by 600,000 equals 0.7, which is 70%. So the LTV in percentage form is 70%, the best match among the options. (If written as a decimal, it’s 0.70.)

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