Loan-to-Value Ratio Explained:

Understanding LVR: Empowering You with Knowledge In the realm of mortgages, understanding key terms like LVR (Loan-to-Value Ratio) is essential for making informed decisions. LVR represents the proportion of the loan amount compared to the appraised value of the property.

Think of LVR like this: It’s the percentage of the property’s value that you’re borrowing.

For example, if you’re borrowing $400,000 for a home that’s worth $500,000, your LVR is 80%.

\[LVR = \frac{{Loan\: Amount}}{{Property\: Value}} \times 100\]

\[LVR = \frac{{\$400,000}}{{\$500,000}} \times 100 = 80\%\]

In this scenario, your LVR would be 80%. Generally, lenders use LVR as a risk assessment tool, with lower LVRs often resulting in more favourable loan terms and interest rates. By understanding LVR and other key mortgage metrics, you’ll be empowered to make informed decisions that align with your financial goals and circumstances.

Experience the Truth Group Difference At Truth Group, we’re more than just buyers’ agents and mortgage professionals – we’re your trusted partners on the journey to homeownership and financial security. Whether you’re buying, or seeking mortgage guidance, our dedicated team is here to provide unparalleled support and expertise every step of the way. Contact us today to experience the Truth Group difference and turn your real estate dreams into reality!

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