CalculateRealEstateROI

Multifamily

What is LTV vs LTC in commercial financing?

LTV = loan ÷ value; LTC = loan ÷ total cost. Lenders use whichever is lower.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Direct answer

LTV = loan ÷ value; LTC = loan ÷ total cost. Lenders use whichever is lower.

Expanded explanation

On stabilized assets LTV controls; on heavy value-add, LTC controls.

Examples

  • $10M cost, $12M ARV: 75% LTV = $9M, 80% LTC = $8M → $8M.

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