Real Estate Math

A buyer in Iowa obtains an 80% LTV mortgage on a $200,000 home. What is the loan amount?

A$40,000✓ Correct
B$160,000
C$180,000
D$200,000

Explanation

Loan Amount = Purchase Price x LTV = $200,000 x 0.80 = $160,000. The buyer's down payment would be $200,000 - $160,000 = $40,000.

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