What is LTC on Fix and Flip Loans

When it comes to fix and flip financing, one of the most important metrics private capital companies like Lulu Capital Inc. consider is the Loan to Cost (LTC) ratio. This ratio helps determine the amount of financing we can provide for a project, ensuring both the investor and lender are positioned for a successful outcome.

Katie Lewis - Executive Vice President - Lulu Capital Inc.

Why is LTC Important?

The LTC ratio is a crucial metric because it helps both investors and lenders assess the risk and potential return of a project. For investors, it determines how much capital they need to bring to the table. For lenders like us, it provides a clear picture of the investment's viability. A lower LTC ratio typically means a lower risk for the lender, as the investor has more of their own money invested in the project.

How Does Lulu Capital Inc. Use LTC Ratios?

At Lulu Capital Inc., we use the LTC ratio as a guiding factor when determining loan amounts for fix and flip projects. We carefully evaluate the total costs involved and structure our financing to ensure a balance between risk and reward. This approach not only protects our investment but also supports our clients in achieving their real estate goals.

Ready to Get Started?

If you're looking to finance your next fix and flip project or need a DSCR loan, Lulu Capital Inc. is here to help. Give us a call or fill out our contact form on our website to get started today!