Question

Margo is purchasing a home for $520,000. The property appraised at $550,000 and Margo is financing $416,000. What's the loan-to-value ratio

Answer 1

Loan-to-value ratio = 0.8

Step-by-step explanation:

Given information:

Purchase cost of house = $520,000

Property appraised value (House value) = $550,000

Margo finance (Loan amount) = $416,000

Find;

Loan-to-value ratio

Computation:

Loan-to-value ratio = Loan value / Purchase cost

Loan-to-value ratio = Margo finance (Loan amount) / Purchase cost of house

Loan-to-value ratio = 416,000 / 520,000

Loan-to-value ratio = 0.8