LCR vs LTC Calculation: What is LCR? | Ram Chauhan posted on the topic | LinkedIn (2024)

LCR or LTC Calculation ??LCR stands for Loan to Construction Ratio or LTC stands for Loan to Cost Ratio, both are sameThe Loan to Cost/Construction ratio of a project is calculated by taking the loan amount and dividing it by the total construction costs.LCR Ratio = Total Loan Amount / Total Construction CostFor example, if a borrower is looking to finance a Rs. 100,000 project and they have a loan-to-cost ratio of 80%, that means they are asking for a loan amount that is 80% of the total cost of the project. The other 20% would need to be paid out-of-pocket by the borrower or through other sources of financing.This Ratio is mainly used in HFC's where loan is given for construction of property.

28

The CRE construction loan portfolio is considered to be a more risky and volatile segment of the overall commercial loan portfolio. Therefore, due to regulatory scrutiny regarding construction portfolio growth and concentrations, CEIS has taken steps to improve its CRE Construction Stress Testing approach.

6

This is called a Hope note we basically do a note which is either a MAS loan. It’s a Hope note it’s we are we IRR so you know above 20% origination is about four points. We’re gonna come behind any second we’re gonna come behind first we’re gonna come behind Anybody that needs hope to get their property to the next level with value ads. It doesn’t matter if it’s in it doesn’t it we like you know the Sunbelt area can be all over. It’s basically personal financial statement credit report, bio Excel spreadsheet, the plan the sources and uses the story. A bunch of pictures of what is subcontractors that you use the lawyers that you had to closing the HUD statement you have to provide all of these things have to be provided if you have an opportunity Give us a call 954-773-5429#mezz#construction#lp#deals#bridgeloans#construction#hardmoney

2

Our No-Experience Ground Up Construction program will be discontinued on June 16th.All active loans in the pipeline and any files submitted to UW prior to the 16th will be honored. We don't foresee this coming back anytime soon so if you have any ground up construction projects that you want to get funded, you need to pull the trigger now!Please complete the pre-qualification form so that we can determine there is have enough ramp-time to complete the submission.For Refi's - Permits & Plans ARE required to be approved and detailed budgets and blueprints will be required for submission. If you do not currently have plans & permits approved, you cannot meet the timeline.For Purchases - Permits & Plans do NOT need to be approved and detailed budgets and blueprints will be required for submissionWe know we're still going to be doing Ground Up Construction for experienced borrowers.Don't wait until its too late!https://lnkd.in/d-bKE4n3Sincerely,The ROC Financial Solutions Team#groundupconstruction

The CRE construction loan portfolio is considered a riskier and more volatile segment of the overall commercial loan portfolio. Due to this, in addition to regulatory scrutiny regarding construction portfolio growth and concentrations, CEIS has refined our CRE Construction Stress Testing approach.

14

DID YOU KNOW? Fannie Mae and Freddie Mac have new, tightened lending standards on condos: Condominium associations should pay particular attention to the fact that lenders are now required to review all structural and mechanical inspection reports, including reserve studies, completed in the prior 3 years from the loan project review. Lenders are now prohibited from issuing loans for complexes with unfunded repairs totaling $10,000 or more per unit.

Constructing a commercial building can be hectic without proper financing. As an investor, finding ways to finance the project to completion should be the priority. The availability of commercial construction loans should help meet your expectations easily. For this reason, learning more about loans is paramount. This guide explains more.https://bit.ly/3MQ2MX8

Constructing a commercial building can be hectic without proper financing. As an investor, finding ways to finance the project to completion should be the priority. The availability of commercial construction loans should help meet your expectations easily. For this reason, learning more about loans is paramount. This guide explains more.https://bit.ly/3MQ2MX8

🏡 Recent Settlement: Partially Complete Construction 🚧 🏗 The scenario:The applicant was looking to finish their incomplete construction project home👷♂️ The obstacle:Significant works required on a Regional Category 2 property to reach completion🛠 The solution:A facility with funding.com.au has allowed our borrowers to complete their high-spec property and refinance from their existing lender at 70% LVR.Does your client base need this type of funding?Reach out with any scenarios you may have related to private short-term lending. Specifically – bridging finance, incomplete constructions, purchases, equity releases or business purposes.

128

7 Comments

🏢📊 Understanding the difference between LTC and LTV is essential in real estate financing. Here's a quick breakdown:1️⃣ LTC (Loan-to-Cost): LTC represents the ratio of the loan amount to the total cost of a real estate project, including land acquisition, construction/renovation costs, and other expenses. It indicates the percentage of the project's cost covered by the loan.2️⃣ LTV (Loan-to-Value): LTV is the ratio of the loan amount to the appraised value or purchase price of the property. It measures the percentage of the property's value that is financed by the loan.While both ratios assess the loan amount relative to the property, LTC focuses on project costs, while LTV emphasizes property value. Lenders consider these ratios to evaluate risk and determine loan terms.Understanding the nuances of these metrics helps investors and developers make informed decisions when seeking financing for their real estate projects. 📊💰#RealEstateFinance #LoanMetrics #PropertyInvestment𝗠𝗼𝗿𝗲 𝗶𝗻𝗳𝗼𝗿𝗺𝗮𝘁𝗶𝗼𝗻: 𝗵𝘁𝘁𝗽𝘀://𝘄𝘄𝘄.𝗶𝗻𝘃𝗲𝘀𝘁𝘄𝗶𝘁𝗵𝘀𝗰𝗼𝘁𝘁𝗸𝗶𝗱𝗱.𝗰𝗼𝗺

1