what is lvr home loan

4 months ago 27

LVR stands for Loan to Value Ratio, and it is a percentage figure that compares how much a lender is willing to loan you against the total value of the property you're buying. It is an important factor in the home loan process, as it is used by lenders to assess the risk of a loan. The LVR is calculated by dividing the loan amount by the purchase price or valuation of the property and is expressed as a percentage. The lower the LVR, the lower the risk to the bank, and it can affect the interest rates and loan terms you may be eligible for. A lower LVR, which means a larger deposit, is generally more favorable. For example, if the property value is $500,000 and you need to borrow $400,000, the LVR would be 80% ($400,000/$500,000 x 100 = 80%)