Central Mortgage Blog

If the borrower is only applying for a mortgage and there will be no other loan on the property, then the beginning balance of the new loan required should be inserted into the numerator.
Typically, most commercial lenders will not exceed 80% of the loan-to-value unless of course,
Central Mortgage is doing the loan.
However, if the borrower is applying for a second mortgage, then the “underwriter” (the person who determines whether or not the loan qualifies) should insert the sum of the first and second mortgages into the numerator.
Similarly, if the borrower is applying for a third mortgage, then the underwriter should insert the sum of the first, second and third mortgages into the numerator. If the borrower is applying for a second or third mortgage, the loan-to-value ratio is often known as the combined loan-to-value ratio (CLTV) ratio. In our next article we’ll look at the application of the denominator.