Commercial LTC Calculator

LTC = loan ÷ total project cost (land + hard + soft + interest + contingency). It is the primary lender constraint for construction and heavy value-add. This calculator stacks all cost components and applies the LTC cap to return max loan and equity required.

Land / purchase cost

Hard construction cost

Soft costs (A&E, fees, legal)

Interest reserve / carry

Contingency

Lender maximum LTC

Max loan at LTC

$7,140,000

Equity required

$3,060,000

Total project cost

$10,200,000

Equity as % of cost

30.00%

Loan as % of hard + soft costs

105.00%

How the math works

LTC sizes construction loans against total project cost — land + hard + soft + interest reserve + contingency. Typical construction LTC: 65-75% for experienced sponsors, 50-60% for first-time. The balance is equity — usually in the form of cash, prepaid land, or a sponsor co-invest.

Lenders require equity to be 'in first' — spent before any loan advance. That protects the lender from spec cost overruns and is why equity timing matters as much as the dollar amount.

How to Use

Enter land, hard, soft, interest reserve, and contingency costs.
Enter lender maximum LTC (typically 65-75%).
Read max loan, equity required, and ratios.

Frequently Asked Questions

LTC vs LTV on construction?

Construction lenders typically test both — LTC against total cost and LTV against stabilized appraised value. Whichever is lower binds. On cost-overrun deals, LTC binds first; on undervalued deals LTV binds.

What's in hard vs soft?

Hard: GMP construction contract + contractor profit + direct site work. Soft: architect, engineers, permits, legal, lender fees, appraisal, environmental reports, construction management. 20-30% of total cost is typical for soft.