What is the relationship between sale price and loan amount in terms of LTVR?

The correct relationship between sale price and loan amount in terms of LTVR (Loan-To-Value Ratio) reflects the formula where the sale price is multiplied by the LTVR to determine the loan amount. LTVR represents the proportion of the loan amount compared to the property's sale price, usually expressed as a percentage.

Using this formula enables buyers and lending institutions to assess how much of the property's value is financed through a loan. For instance, if a property has a sale price of $200,000 and the LTVR is 80%, this calculation would state that the loan amount would be $200,000 multiplied by 0.80, leading to a loan amount of $160,000.

In this context, other options do not accurately describe the relationship. The first option suggests a division, which does not directly help in solving for the loan amount. Likewise, the third option incorrectly suggests that the loan amount is calculated through multiplication of the sale price, which does not align with the definition of LTVR. Therefore, the second option provides the clear, correct formula for understanding how to derive the loan amount from the sale price and the loan-to-value ratio.