# How much would you have to put down on a house, costing $100,000, if the house had an appraised... ## Question: How much would you have to put down on a house, costing$100,000, if the house had an appraised value of $105,000, and the lender required an 80% loan-to-value ratio? ## Loan-to-Value Ratio Banks may choose to impose a maximum loan-to-value ratio on certain loans in order to minimize its risk of borrower default. This ratio is often used in real estate mortgages and loans for other long-term assets, to ensure that the borrower makes an adequate down payment. ## Answer and Explanation: With an appraised value of$105,000 and a loan-to-value rate of 80%, the maximum mortgage available would be $105,000 x 0.8 =$84,000.

Therefore, the down payment on the house would need to be at least $100,000 -$84,000 = \$16,000.