Question

Loan to value A) is the appraised value divided by the amount of the loan B)...

Loan to value

A) is the appraised value divided by the amount of the loan

B) is often 85% in most long term commercial loans with Insurance Companies

C) is a measure of loan amount to purchase price and is a limiting factor in determining how much of a loan a lender will allow

D) is only a focus of residential loans, not commercial

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Answer #1

the correc answe is c.

A is incorrect becuase loan to value ratio is loan value divided by the pruchae price.

b is also incorrect becuase 85% sanction limit is not fixed. it depends upon various factors and in some case upto 95 % is allowable

d is also incorrect becuase loan to value ratio is applicable in all cases of mortgage whether residential or commercial

C. is the correct opton. Loan to vaue is a meaure of loan limit allowed ot the purchase price depeding upon many factors consider which lender provides the loan amount.

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