# Loan-to-Value Ratio: Definition & Formula

Instructions:

question 1 of 3

### What is loan-to-value ratio in real estate?

Create Your Account To Take This Quiz

As a member, you'll also get unlimited access to over 79,000 lessons in math, English, science, history, and more. Plus, get practice tests, quizzes, and personalized coaching to help you succeed.

Try it risk-free for 30 days. Cancel anytime

### 2. How does a down payment affect the loan-to-value ratio?

Create your account to access this entire worksheet
Quizzes, practice exams & worksheets
Certificate of Completion
Create an account to get started

A key value that is calculated during the process of the sale of a home is the loan-to-value (LTV) ratio. The questions on this quiz/worksheet combo will test your knowledge of the factors that affect the LTV ratio, the formula used to calculate this ratio and how to determine the appraisal value.

## Quiz & Worksheet Goals

In this quiz, the questions will cover:

• Loan-to-value (LTV) ratio definition
• Formula for determining the LTV ratio
• How a down payment affects the LTV ratio
• How the LTV ratio is affected by the sales contract price
• Who determines the appraised value of a home

## Skills Practiced

• Information recall - access the knowledge you've gained about the formula used to calculate the LTV ratio
• Reading comprehension - ensure that you draw the most important information from the lesson that discusses the factors that affect the LTV ratio
• Defining key concepts - ensure that you can accurately define main phrases, such as loan-to-value ratio