LTC is calculated as the loan amount divided by the construction cost. Meanwhile, loan-to-value (LTV) compares the loan amount to the expected market value of the completed project. A higher LTC means the project is riskier for lenders, where most lenders will only finance a project with an LTC of up to 80%.

What is Max LTC?

Basically, if a borrower hits a lender's maximum LTC or dollar amount limit, they'll have to invest more money into the project. A higher loan-to-cost ratio means that the lender is taking more risk to fund the project. ... A lower LTC means that a smaller percentage of the project's cost is being financed.

What is LTC investment?

The loan-to-cost ratio (LTC) is the number of debt investment dollars divided by the total cost of a project. ... In the case of real estate crowdfunding, crowdsourced investors also examine an investment project's LTC as a form of due diligence. An exceptionally high LTC could indicate an over-leveraged loan or borrower.