Description

The loan-to-value (LTV) ratio is a financial term that measures the ratio of a loan to the value of an asset purchased. It is commonly used by lenders to assess risk when providing mortgages or loans, with higher ratios indicating greater risk.

Interpreter Notes

Interpreters should be aware that the term 'loan-to-value ratio' may be used in various financial contexts, including real estate transactions. Common variants include 'proporción de préstamo a valor' and 'razón de deuda a valor', but it is recommended to use the glossary term for clarity in formal settings.

Example Sentences

EN: The bank requires a loan-to-value (LTV) ratio of no more than 80% for mortgage approval.

ES: El banco requiere una proporción entre el monto de la deuda actual y el valor de la propiedad en el mercado de no más del 80% para la aprobación de la hipoteca.

Common Interpreter Mistakes

Confusing LTV with other financial ratios; misinterpreting the term as a direct measure of creditworthiness; mixing up related terms like 'debt-to-income ratio'.