We have a $170,000 loan that was to purchase a home for $150,000 and $20,000 additional money for renovations of the home. The loan is secured by the home being purchased and additional collateral in lieu of a down payment. When calculating the LTV for supervisory guidelines, I understood the guidance to read that you would use the lesser of the cost or appraised value and anything over 90% for residential gets reported to the board. In this situation we did finance over 100% of the cost of the home but with the additional collateral and appraised value of the home after renovations, we are within the 90% LTV. How would I calculate the LTV for the supervisory guidelines report that goes to the board? I may have missed this in this guidance https://www.fdic.gov/regulations/laws/rules/2000-8700.html Thanks!

A purchase plus loan is not really mentioned in the guidance, but if you have an "as completed" appraisal that does not over value the market value of the improvements and you are controlling the disbursements and have additional collateral (you don't say what this collateral might be or of what value), then I would think you would be fine as long as you remain under 90% for the duration of the project.

I would see this similar to a multiple phase real estate project.