Glossary

Loan-To-Cost Ratio (LTC)

The Loan-To-Cost Ratio is a measure used in commercial real estate to determine the maximum loan amount that can be borrowed for the purchase and renovation of a property. The LTC is calculated by dividing the amount of the loan by the total cost of the project. LTC is typically expressed as a percentage. For example, if the total cost of a project is $1,000,000 and the maximum loan amount that can be borrowed is $700,000, the LTC would be 70%.