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Calyx Software Knowledgebase


2809 Understanding LTV and CLTV calculations (Loan-to-Value and Combined Loan-to-Value)


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LTV

The Loan-to-Value (LTV) is calculated by dividing the loan amount into the Sales Price or Appraised Value, whichever is lower. For refinance loans, it is calculated by dividing the loan amount into the appraised value.


For example:

Sales Price:  $300,000    

Appraised Value:  $295,000     

Loan Amount:  $236,000



Since the Appraised Value is lower than the Sales Price, the Appraised Value is used to calculate the LTV


Loan Amount /Appraised Value = LTV 

236,000/295,000 = 80% LTV.




CLTV

The Combined Loan-to-Value (CLTV) is calculated by dividing the total of the Loan Amount and any additional subordinate financing into the Sales Price or Appraised Value, whichever is lower, or simply into the appraisal value for refinance loans


For example: 

Sales Price:  $300,000    

Appraised Value:  $295,000     

Loan Amount:  $236,000     

Sub Financing:  $30,000



Since the Appraised Value is lower than the Sales Price, this value is used to calculate the CLTV

Loan Amount + sub financing amount /Sales price = CLTV

236,000 + 30,000 / 295,000 = 90% CLTV.



Note: When more than one mortgage exists for the same property, complete the Sub Financing fields by clicking the Sub Financing button at the bottom of the Borrower Information screen.


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Last Modified: Last Year
Last Modified By: cswms
Type: Loans
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