Finance
A real estate investor who borrows 70% of a property's value and pays the remaining 30% in cash has used leverage at a(n):
A70% LTV ratio✓ Correct
B30% LTV ratio
C70% equity ratio
D50% LTV ratio
Explanation
LTV (loan-to-value) = Loan ÷ Property Value = 70% ÷ 100% = 70% LTV ratio. Understanding mortgage finance is essential for Alabama real estate professionals advising buyers.. The correct answer is 70% LTV ratio.
Related Alabama Finance Questions
- What does the Truth in Lending Act (TILA) require lenders to disclose to Alabama borrowers?
- Which of the following best describes 'seller concessions' in a real estate transaction?
- Which of the following loan types does NOT require a down payment from eligible borrowers?
- Fannie Mae (FNMA) and Freddie Mac (FHLMC) are:
- The margin in an ARM loan is:
- Which federal law requires lenders to provide a Loan Estimate to mortgage applicants within 3 business days of application?
- Which type of loan insures the lender against loss and allows borrowers to purchase with as little as 3.5% down with a 580+ credit score?
- When a lender requires a buyer to purchase homeowner's insurance as a condition of the loan, the lender is protecting:
Practice More Alabama Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Alabama Quiz →