5d • General discussion
KNOW IT THURSDAY'S: LTV
What lenders mean when they say… LTV?
LTV stands for Loan-to-Value. Here's the easy way to understand it:
How much of the property is the bank financing?
Let's say a property is worth $500,000.
The bank lends you $400,000.
That's 80% LTV.
The bank is financing 80% of the property's value.
You don't need to be a math person to understand this one.
Just remember:
𝗛𝗶𝗴𝗵𝗲𝗿 𝗟𝗧𝗩 = 𝗺𝗼𝗿𝗲 𝗼𝗳 𝘁𝗵𝗲 𝗽𝘂𝗿𝗰𝗵𝗮𝘀𝗲 𝗶𝘀 𝗯𝗲𝗶𝗻𝗴 𝗳𝗶𝗻𝗮𝗻𝗰𝗲𝗱. And lenders may have different LTV requirements depending on the property and loan. So SHOP around!
Learn the language. Understand the numbers. Make better real estate decisions.
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KNOW IT THURSDAY'S: LTV
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