1 / 10

Here’s Everything You Need to Know About the LTV Ratio

Financial institutions, on the other hand, utilise this ratio to assess the risk of granting a loan to a specific borrower who owns an asset. In a secured loan , borrowers cannot acquire a loan amount more than the LTV percentage. Furthermore, the higher the LTV ratio, the greater the chance of default.

HeroFinCorp
Download Presentation

Here’s Everything You Need to Know About the LTV Ratio

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Here’s Everything You Need to Know About the LTV Ratio

  2. 1 What does the LTV ratio mean? It means loan to value ratio with respect to the property's current market value. You cannot receive funds greater than LTV.

  3. 2 How to calculate the LTV ratio? Use formula- (Amount borrowed ÷ Property's value) × 100 You can also use an online LTV ratio calculator.

  4. 3 How does the loan-to-value ratio work? The lender determines the loan amount based on your property's worth. LTV is used to set the upper borrowing limit against the property.

  5. 4 RBI directive on LTV ratio For a house loan up to Rs 30 lakhs, the maximum LTV allowed is 90%. Loans ranging between Rs 30 lakh and Rs 75 lakhs can qualify for 80% LTV. For loans above Rs 75 lakhs, you can get 75% of the property value.

  6. 5 Is it better to have a higher LTV or lower LTV?

  7. 6 From the lender's perspective A lower LTV minimises the chance of default.

  8. 7 From the borrower's perspective Borrowers prefer a higher loan-to-value ratio to deal with their money crunch better.

  9. It is crucial to understand the loan-to-value ratio well before applying for a secured loan.

  10. Thank You ! Would Love to hear from you. Hero Fincorp Limited 09, Basant Lok, Vasant Vihar, New Delhi - 110057 Tel : 18001024145 Email : corporate@herofincorp.com Website : https://www.herofincorp.com/ Know More : https://www.herofincorp.com/blog/here-s-everything-you-need-to-know-about-the-ltv-ratio

More Related