Loan to Cost Ratio (LTC)

The loan to cost ratio (LTC) is the direct ratio of loan amount offered by the lender to the actual cost of development. It is often used to quantify the involvement (stake) of the lender in the project.

Gross Development Value (GDV)

The gross development value (GDV) is the projected, open-market value the project is expected to attain upon completion. The GDV, in essence, is an indicator of the profit margin the project is expected to return.

Legal Charge

A legal charge is a form of security against outstanding debts. In the context of property development, the lender may put a legal charge on the site or the building in order to hedge the loan amount against potential non-repayment.

Personal/Corporate Guarantee

A personal or corporate guarantee is an assurance offered by the borrower to the lender. Such guarantees mean that the guarantor agrees to be held responsible for the loan.

Collateral Warranty

Collateral warranty is a sub-contract to support the primary contract (the loan agreement, in this context). The purpose of having a collateral warranty in place is to deter lax discharge of contractual duties.


The last stretch of property development in which the building is habitable.

Fixed Interest Rate & Tracker Interest Rate

Fixed interest rates stay locked over the lifetime of the loan. On the other hand, tracker interest rates fluctuate (tethered to Libor rates, in most cases) to reflect the health of the markets on the whole.