Question

Amy agreed to a contract price of $100,000 for a home and secured a mortgage loan for $80,000. If the appraised value is $110,000, what is the loan to value ratio?

Answer 1

loan to value = 80%

Step-by-step explanation:

given data

contract price = $100,000

mortgage loan = $80,000

appraised value = $110,000

solution

we get here loan to value ratio that is

loan to value =
`(loan)/(contract\ price)` .................1

here lender use less of contract price or appraised value

so put here value in equation 1 we get

loan to value =
`(80000)/(100000)`

loan to value = 0.80

loan to value = 80%