Facts to Understand about 80 Ltv Hard Money Loans

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Facts to Understand about 80 Ltv Hard Money Loans
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If we compare the value of the property with the
amount of mortgage the number that we get is the
loan-to-value ratio. It would be clearer if we
cite an example. Like if you get an 80,000
mortgage for purchasing a 100,000 home then you
get a loan where the loan-to-value ratio is 80.
There are lenders in California who make it
possible to have 80 LTV hard money loans. So, it
is prudent to contact them when you require such
a loan, they will help you in all respect. If we
notice from the perspective of a lender, then a
mortgage having a high loan-to-value ratio is
riskier. For mortgages that have a loan-to-value
ratio above 80, there would be a requirement for
mortgage insurance. In the mortgage biz, we call
loan-to-value LTV in short.
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• How lenders use LTV
• An LTV ratio is one of the factors to determine
  the eligibility for having a mortgage, a home
  equity loan, or a line of credit. However, LTV
  can play a considerable role to determine the
  rate of interest possible for a borrower to have.
  It is noticed that lenders make it possible to
  have mortgage and home-equity candidates with the
  least possible rate of interest if their LTV
  ratio is 80 or below.
• Is it possible to have a mortgage with a higher
  LTV?
• However, if you have a higher LTV ratio it does
  not mean that you cannot have approved a
  mortgage. The only difference that may arise is
  that the loan interest may rise as there is an
  increase in the LTV ratio. Let us make it clear
  with an example. If you as a borrower have an LTV
  ratio of 95 can have approval for a mortgage.
  However, if we compare their rate of interest
  rate with that of a borrower with an LTV ratio of
  75 the rate will be higher.

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What is PMI If your LTV is more than 80 there
might be a requirement to purchase private
mortgage insurance. This can be 0.5 to 1
additional to the entire loan amount on an annual
basis. A PMI with a 1 rate on a loan of 100,000
would be an additional 1,000 which one has to
pay per year. One needs to pay the PMI until the
LTV ratio is below 80. The LTV ratio can
decrease as you pay back your loan and as the
value of your house enhances with time. However,
if we notice, then we will see that it is
possible to have a greater chance of loan
approval with a lower LTV and the borrower does
not have to buy PMI. It is also that a lower LTV
will make it possible to have the loan at a lower
rate of interest. Is it always necessary to buy
PMI with a higher LTV Generally, it is a rule
for lenders that they urge borrowers to buy PMI
when they have a higher LTV. However, exceptions
can be made when the borrower has a high income,
lower debt, or may be having a large investment
portfolio. If you desire to have 80 LTV hard
money loans it is wise to contact All California
Lending. Call them at 877 462 3422 to get started
today.
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Thanks!

• Any questions?
• You can find me at
• www.acalending.com