Loan To Value Ratio Definition Wednesday, October 2, 2:09 PM ET
LTV, or the loan to value ratio measures the ratio of a loan, for example, a mortgage, to the value of the underlying asset
For example, if someone borrows $320,000 for a $400,000 house, the LTV would be $320,000/$400,000, or 80%. A higher loan to value ratio means a riskier loan for the lender, as the lender would be providing a larger share of the asset purchase price.
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