The lowest blended advance that still supports the loan

Ask a different question of the same two totals. The closing balance is $1,858,563.47. The market value is $6,032,795. The lowest blended advance rate that still produces enough lending value to cover that balance is the quotient of the two: 1,858,563.47 ÷ 6,032,795 = 0.308077, which is 30.81 percent. At that blend, lending value would be exactly $1,858,563.47.

That 30.81 percent is also closing LTV on market value. Track 1 lesson 6 defined LTV as balance divided by collateral. On a market-value basis the closing LTV is 1,858,563.47 ÷ 6,032,795, which is the same 30.81 percent. The 'lowest supporting blend' is not a new number. It is the current loan-to-value, restated as if it were an advance rate the schedule might set.

A lender would not set 30.81 percent. Advance rates are assigned by category, in advance of any particular balance, to price an exit. 30.81 percent here is a description of how large the loan already is relative to the wealth. It answers: how far could the recognised fraction fall, mix held still in percentage terms, before lending value merely equals the loan. It does not answer: what rate belongs on Calder.

On the applied book the blend is 54.32 percent and lending value is $3,277,251.25, so closing LTV on lending value is 1,858,563.47 ÷ 3,277,251.25 = 0.56681, which is 56.68 percent. Plenty of room against the collateral, and no room whatever against a 30.81 percent blend, because that blend is the room used up. Treating 30.81 percent as a scheduled rate would collapse the distinction Track 1 lesson 3 opened the curriculum with.

If the lowest blend that supports the loan equals the LTV, you have not found an advance rate. You have found the loan, written as a percent of the market.