Freehold
Loans & LTV formula
LTV = loan amount ÷ appraised value (or price, whichever is lower)
LTV = loan amount ÷ appraised value (or price, whichever is lower)
Worked example: A buyer borrows $255,000 on a home appraised at $300,000.
85% LTV
Every Freehold question shows why the right answer is right — and cites its source.
A buyer purchases a home for $250,000 with an 80% loan-to-value mortgage. What is the loan amount?
$200,000 — Multiply the price by the loan-to-value ratio: $250,000 × 0.80 = $200,000. The remaining $50,000 is the buyer's down payment.
Source: PSI National Real Estate Exam Content Outline §11 Real Estate Calculations
At closing, the seller's prorated share of the annual HOA dues was $637.50 for 8.5 months of ownership (paid in arrears, monthly proration). What is the annual HOA due amount?
$900 — The monthly rate is $637.50 ÷ 8.5 = $75. Multiplying by 12 gives the annual amount: $75 × 12 = $900.
Source: PSI National Real Estate Exam Content Outline §11 Real Estate Calculations
A buyer purchases a home for $315,000 with a 90% loan-to-value mortgage. What is the loan amount?
$283,500 — Multiply the price by the loan-to-value ratio: $315,000 × 90% = $283,500.
Source: PSI National Real Estate Exam Content Outline §11 Real Estate Calculations
All 14 formulas in one place: Real estate math reference