Laenuväärtus
Laenuväärtus, a term originating from Estonian, translates to loan-to-value (LTV) in English. It is a financial metric used by lenders to assess the risk associated with a mortgage loan. The laenuväärtus represents the ratio of the loan amount to the appraised value of the property being purchased. For example, if a property is valued at 100,000 euros and a borrower seeks a loan of 80,000 euros, the laenuväärtus would be 80%.
Lenders use laenuväärtus as a primary factor in determining loan approval and the terms of the mortgage.
Regulatory bodies often set maximum limits for laenuväärtus to ensure financial stability and prevent excessive risk-taking