What is ltv and what is residual incom

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Accepted Answer

LTV stands for Loan-to-Value ratio, which is a financial term used by lenders to assess the risk of a loan. Residual income is the amount of income that remains after all debts and expenses have been paid.

LTV is calculated by dividing the loan amount by the appraised value of the property
A lower LTV ratio indicates a lower risk for the lender
Residual income is the income that an individual has left over after paying all debts and expenses
Lenders may consider residual income when evaluating a borrower's ability to repay a loan
For example, if a borrower has a monthly income of $5,000 and monthly expenses of $4,000, their residual income would be $1,000

What is ltv and what is residual incom

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