Finance
The 'loan-to-value ratio' (LTV) on a $400,000 property with a $320,000 loan is:
A75%
B80%✓ Correct
C85%
D125%
Explanation
LTV = Loan Amount ÷ Property Value × 100 = $320,000 ÷ $400,000 × 100 = 80%. LTV is an important underwriting metric—higher LTV ratios represent more risk to the lender and may require private mortgage insurance (PMI) or result in higher interest rates.
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