Real Estate Math

A buyer purchases a $450,000 home and puts 20% down. The conventional loan is at 6.5% for 30 years. What is the LTV at origination?

A20%
B60%
C80%✓ Correct
D85%

Explanation

Down payment = $450,000 × 20% = $90,000. Loan = $450,000 - $90,000 = $360,000. LTV = $360,000 ÷ $450,000 = 80%.

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