What is Loan-to-Cost Ratio (LTC)?

Loan-to-Cost Ratio (LTC) Definition

Loan-to-cost ratio (LTC) is a metric that compares the amount of financing a real estate construction project has to the cost it will take to build the project. In terms of HUD multifamily loans, LTC typically only affects HUD 221(d)(4) loans and HUD 232 loans, as these types of financing involve the new construction or substantial rehabilitation of multifamily and healthcare properties.


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