Loan Amount / Value of the Collateral. This ratio is most often used in evaluating the risk of real estate loans, where the appraised value of the property can be more objectively ascertained. The higher the LTV, the riskier the loan. The bank may specify a maximum LTV in order to make a loan.6
Tony Lettich
Tony Lettich has previous Business Analysis, Business Valuation, M&A, and Venture Capital experience and currently serves as the Managing Director of The Angel Roundtable and a Partner in Sheehan, Lettich M&A Advisory. He is also a co-founder of FundingSage, which provides valuable information, tools and resources to entrepreneurs seeking to launch and build startups.
