Finance
The 'loan-to-value ratio' (LTV) determines the percentage of a Vermont property's value that is financed. A lower LTV generally means:
AHigher risk for the lender and higher mortgage insurance costs
BLower risk for the lender, better loan terms for the borrower, and usually no PMI requirement✓ Correct
CA smaller down payment required
DA higher interest rate for the borrower
Explanation
A lower LTV means the borrower has more equity (a larger down payment) relative to the loan amount. This reduces the lender's risk of loss on default, typically resulting in better loan terms (lower rates), no PMI requirement (below 80% LTV), and easier qualification.
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