loan value definition

loan value

Amount a lender will lend against an asset used as a collateral to secure the loan. Generally, lenders accept only that asset as a collateral which has an appraised liquidation value at least 25 percent higher than the loan amount (to cover liquidation and other charges in case of a foreclosure). The difference between the market value of a collateralized asset and the amount of loan advanced against it called haircut.

loan value is in the Accounting & Auditing and Banking, Commerce & Finance subjects.

loan value appears in the definition of the following term: haircut

This content can be found on the following page:

http://www.businessdictionary.com/definition/loan-value.html