We use LTC (Loan-to-Cost) to assess the security of a development loan. The LTC is the ratio between the amount of money we lend against a property development project and the estimated costs required to deliver the development project.

Good to know

As responsible and risk-averse lenders, we don’t necessarily lend all the funds in one go. 

For large developments, borrower funds are released in smaller amounts known as ‘tranches’. 

Tranches are installed to protect investor money and ensure funds are effectively deployed at key stages of the development. Borrowers are subject to regular on-site assessments to ensure funds are being used correctly and the project remains on schedule. In some instances, we expect the borrower to have pre-sold some of the properties in order for funds to be released.

All development projects are subject to monthly reporting from our external monitoring surveyors. We only release construction funds once the agreed works have been completed.