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Lima One
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Understanding Loan to Cost in the real estate industry

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Loan to cost (LTC) is a measure of how much debt a lender is willing to provide for a real estate project. LTC is an important factor for investors to consider when evaluating financing for a real estate investment. Several factors can affect LTC in real estate, including the type of property, the location of the property, and the lender’s risk appetite. In general, lenders are more willing to provide loans with a lower LTC ratio because it limits the lender’s risk while ensuring that the investor still has skin in the game.

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