A lender offers an investor a maximum 70% LTV loan on the appraised value of a property. If the investor pays $230,000 for the property, and this is 15% more than the appraised value, how much will the investor have to pay as a down payment?

the correct answer is

First, the sale price is 115% of the appraised value, so the appraised value is $230,000 / 115%, or $200,000. The lender will lend $140,000 (70% of appraised value), so the investor will have to come up with $90,000 ($230,000 - $140,000).

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