Good morning, Jodie Tanga here with your Mortgage Minute. Today's topic, loan terminology—often times lenders might use some terminology that is not common knowledge. LTV and DTI are some examples.
So what is LTV? It stands for loan to value and it is the loan size compared to the value of the property. In a purchase, the loan to value will change the interest rate you may qualify for. For example, an 80% loan to value will have a less costly interest rate than a 90% loan to value. A common misconception is that you can't buy unless you have 20% down payment, this is not true. Stay tuned for a future segment when we will talk more about lower down payment options.
For a list of commonly used acronyms used in mortgage lending and their definitions, please call us, the Tanga Mortgage Team powered by Pacific Rim Mortgage at (808) 223-2761 or visit us at www.pacrimmtg.com.
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