Loan-to-value ratio

Loan-to-value ratio

In lending practice, the loan-to-value ratio is the maximum loan permitted by federal and state regulation based on a ratio of the loan to the loan value of the property. As an investment term, loan-to-value ratio is the ratio of the existing loan to the fair market value of the property.

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Part of Speech: noun
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Industry/Domain: Financial services
Category: Real estate investment
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Related terms

loan to value ratio

Banking; Investment banking

Ratio of the fair market value of a collateral to the value of the loan that will finance the purchase. The more stable the value of an asset, the higher the loan to value ratio. ...

loan-to-value ratio

Financial services; Real estate investment

In lending practice, the loan-to-value ratio is the maximum loan permitted by federal and state regulation based on a ratio of the loan to the loan value of the property. As an ...

loan-to-value ratio (LTV)

Business services; Relocation

The relationship between the principal balance of the mortgage and the appraised value (or sales price if it is lower) of the property.

loan-to-value ratio (LTV)

Financial services; General Finance

The ratio of money borrowed on a property to the property's fair market value.

loan-to-value ratio

Construction; General

The ratio of the loan amount to the property valuation and expressed as a percentage. E.g. if a borrower is seeking a loan of $200,000 on a property worth $400,000 it has a 50% ...

loan-to-value ratio

Accounting; Tax

The percentage a lending institution will loan to the appraised value of a property For example, if the property is appraised for $100,000 and a bank will loan only $70,000, the ...

accelerated cost recovery system (ACRS)

Financial services; Real estate investment

Before 1981, assets used for the production of income were depreciable if they were subject to wear and tear or decline due to natural causes or obsolescence. Assets that did not ...

accelerated depreciation

Financial services; Real estate investment

Accelerated depreciation is a method of depreciation in which larger deductions are taken earlier in the life of the asset than with the straight-line method. Examples include the ...

account

Financial services; Real estate investment

An account is a written record of a business transaction expressed in money and kept in a ledger.

accounting principles

Financial services; Real estate investment

Accounting principles refer to an accounting doctrine that explains current practices and is a guide for the selection of accounting conventions or procedures when alternatives ...

accrued depreciation

Financial services; Real estate investment

Accrued depreciation is the difference between the cost of replacing new property and the present market value of the property.

active income

Financial services; Real estate investment

Active income is all taxable income of a taxpayer except income from a passive activity and portfolio income. Passive activity is something in which the taxpayer does not actively ...

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