Bob wishes to refinance his mortgage and pay off his credit cards without using any personal funds. He owes $75,000 on his first mortgage, $10,000 on his second mortgage, and $3,000 in credit card debt. What would his appraisal value need to be if his closing costs are $4,000 and he qualifies for an 80% LTV

This can be calculated by simply using the Loan-to-Value (LTV) to divide the summation of the two mortgages and credit cards together with closing costs which Bob wishes to refinance by following the following steps:

Step 1: Calculation of summation of the two mortgages, the credit cards and closing costs

Total amount to finance = $75,000 + $10,000 + $3,000 + $4,000 = $92,000

Step 1: Division of Bob’s appraisal value

Bob’s appraisal value = Total amount to refinance ÷ LTV = $92,000 ÷ 0.8 = $115,000

Therefore, Bob’s appraisal value would be $115,000.