Real Estate Math
A Minnesota buyer pays $15,000 down on a $150,000 property. What is the loan-to-value (LTV) ratio?
A10%
B90%✓ Correct
C85%
D80%
Explanation
Loan amount = $150,000 - $15,000 = $135,000. LTV = Loan Amount / Property Value = $135,000 / $150,000 = 0.90 = 90%. An LTV of 90% means the buyer borrowed 90% of the purchase price (10% down). LTVs above 80% typically require PMI for conventional loans.
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