Loan to Value Ratio:

[Shah Alam Kabir Pramanik]

Loan to Value Ratio:
The Loan to Value Ratio (LTV) shows how much equity the borrowers have in a house relative to the amount they want to borrow or already have borrowed, and is one of the key risk factors assessed by lenders. In public sector the average loan-to-value ratio is 60% except for group loans, which have a loan-to-value ratio of 80%. But property appraisal system should be valid and logical. In property valuation registration cost of the property is also incorporated.
In private sector average value to loan ratio is more than public sector (up to 70% by DBH). In this study authors have found that customers expect rational loan to value ratio. In private sector the loan to value ratio varies. It depends on the nature of customers