Ask Question
31 March, 23:15

Given the following information, calculate the loan-to-value ratio of this commercial loan: estimated net operating income in the first year: $150,000; debt service in the first year: $100,000; loan amount: $1,000,000; purchase price: $1,300,000.

a. 1.75

b. 0.77

c. 0.08

d. 1.30

+5
Answers (1)
  1. 1 April, 00:21
    0
    b. 0.77

    Explanation:

    The formula to compute the loan to value ratio is shown below:

    = Loan amount : Purchase price

    = $1,000,000 : $1,300,000

    = 0.77

    It shows a relationship between the loan amount and the purchase price so that the accurate ratio can come

    All other information that is given is not relevant as it is related to the debt yield ratio. Hence, ignored it
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “Given the following information, calculate the loan-to-value ratio of this commercial loan: estimated net operating income in the first ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers