LTV Ratios

The LTV ratio is a phrase you will hear all the time in the mortgage industry. It stands for loan-to-value ratio. It essentially represents the percentage of the money borrowed against the value of the property. If the real estate is worth $100,000 and you borrow $80,000, the LTV ratio is 80 percent. As you can probably guess, the lower your loan to value ratio, the happier the lender. The happier the lender, the more it is willing to overlook snafus on your credit, earning history and so on.