Printable cheat sheet

Texas LTV and down payment cheat sheet

Built for Texas sales agent exam prep. Choose the value basis first, keep the loan on top of the LTV fraction, and check whether a low appraisal changes the cash needed.

Reviewed August 30, 2026 · CFPB and Fannie Mae definitions · Outline #094401

Use the calculator

LTVLoan / value basis

The loan amount goes on top. Convert the decimal answer to a percent.

Loan amountValue basis x LTV

Convert the LTV percent to a decimal before multiplying.

Value basisLoan / LTV

Use this when the problem gives loan amount and target LTV and asks for the ratio base.

Down paymentPrice - loan

Down payment dollars are based on purchase price, not always the value basis.

Down percentDown payment / price

The shortcut is clean only when purchase price and value basis match.

Low appraisalChoose value basis first

Use the lower value for the common LTV trap, but use the named base if the stem says purchase price or appraised value.

The exam setup rule

Name the final ask: LTV, loan amount, value basis, down payment, or down percent.
Choose the value basis before calculating.
Use the named base if the stem says loan-to-purchase-price or loan-to-appraised-value.
Convert LTV percent to a decimal when multiplying or dividing.
Calculate the loan before calculating down payment.
If appraisal is lower than price, check the extra cash gap.

Five worked examples

Basic LTV$320,000 loan on a $400,000 value basis

$320,000 / $400,000 = 0.80 = 80% LTV.

Find loan$400,000 value basis at 80% LTV

$400,000 x 0.80 = $320,000 maximum loan.

Find down payment$400,000 purchase price, $320,000 loan

$400,000 - $320,000 = $80,000 down payment.

Low appraisal$400,000 price, $390,000 appraisal, 80% LTV

$390,000 x 0.80 = $312,000 loan. $400,000 - $312,000 = $88,000 cash needed.

Reverse value basis$320,000 loan at 80% LTV

$320,000 / 0.80 = $400,000 value basis.

Traps to check

Do not flip the LTV fraction. Loan amount goes over value basis.
Do not multiply by 80 for an 80% LTV. Use 0.80.
Do not assume down payment percent is always 100% minus LTV when price and appraisal differ.
Do not answer loan amount when the final ask is down payment.
Do not choose the higher value when the stem is testing a lower-appraisal loan base.
Do not force lower-of-value when the stem explicitly names purchase price or appraised value as the ratio base.

Work it without the answer showing

Name the value basis before using a formula. Keep first-mortgage LTV, CLTV, buyer cash, and cash to close as separate ideas.

Problem 1 · LTV and CLTV$450,000 price, $430,000 appraisal, $344,000 first mortgage, and $21,500 second loan. Use the lower value. Find LTV, CLTV, buyer cash toward price, and appraisal gap.

Value basis
LTV or loan
CLTV or cash
Final check

Problem 2 · loan from target LTV$500,000 price, $475,000 appraisal, and 75% target LTV using the lower value. Find first mortgage and buyer cash toward price.

Value basis
LTV or loan
CLTV or cash
Final check

Problem 3 · reverse value$285,000 first mortgage at 76% LTV. Find the implied value basis.

Value basis
LTV or loan
CLTV or cash
Final check

Answer key

Value basis is $430,000. First-mortgage LTV is $344,000 / $430,000 = 80%. CLTV is ($344,000 + $21,500) / $430,000 = 85%. Buyer cash is $450,000 - $365,500 = $84,500. Appraisal gap is $20,000.
$475,000 x 0.75 = $356,250 first mortgage. Buyer cash toward price is $500,000 - $356,250 = $143,750.
$285,000 / 0.76 = $375,000 implied value basis.

Sanity check

A larger loan on the same value basis should create a higher LTV.
A lower loan on the same value basis should create a lower LTV.
Down payment dollars plus loan amount should equal the purchase price.
On forward loan/down-payment problems, multiplying by an LTV below 100% should reduce the amount. On reverse value problems, dividing by the LTV decimal should recreate the larger value.
When appraisal is lower than price, cash needed can be larger than the simple down-payment shortcut.