UAE used-car glossary

Loan-to-Value (LTV)

Also known as LTV ratio, car loan ratio.

Loan-to-value is the percentage of a car's price financed by a loan. UAE auto lenders typically extend up to 80% LTV on used cars, with stricter caps on older vehicles. When the car's market value drops faster than the loan balance, the borrower goes 'underwater' — a common risk on long-tenor luxury sedans.

Related terms

Resale Value
Resale value is the price a used car is expected to fetch on the open market, typically several years after its initial purchase.
Depreciation
Depreciation is the drop in a vehicle's market value over time, expressed as a percentage of the original purchase price.

Put it to work

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Understanding loan-to-value (ltv)is half the negotiation. The other half is knowing your car's actual fair-market range — independent, no agenda.

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