Finance
The loan-to-value ratio (LTV) is calculated as:
ALoan amount divided by the property's appraised value✓ Correct
BAppraised value divided by the loan amount
CPurchase price divided by monthly payment
DMonthly payment divided by gross income
Explanation
LTV is calculated by dividing the loan amount by the property's appraised value (or purchase price, whichever is lower). A lower LTV ratio means less risk for the lender.
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