Purpose
Many home builder credit agreements limit how much speculative inventory a borrower can carry relative to presold homes, for example, no more than one spec home for every four presold homes in a community. Ratio sublimits let lenders configure these covenants directly on Borrowing Base and MGLOC loans, so Built tracks compliance and flags breaches automatically instead of lenders maintaining a separate spreadsheet for every draw cycle.
Key Features
Ratio Sublimit Types: Two new count-based limit types cap the number of one collateral type relative to another (Type A to Type B ratio), either across the whole loan or within a specific subdivision.
Guided Setup: A three-step Add Sublimit flow walks through choosing the collateral types, the limit type, and the limit values.
Limitations Tracking: The loan Overview shows every sublimit's limit, current ratio, and remaining capacity, with a clear in-compliance or over-limit indicator.
Breach Warnings on Collateral Changes: When a collateral change affects a ratio sublimit, a confirmation dialog shows the impact on each rule before the change is saved.
Target Users
Portfolio Managers and Credit Officers: configure sublimits to match loan covenants.
Draw Processors and Loan Administrators: monitor compliance and review warnings when updating collateral.
Borrower portal: a read-only limitations overview.
How It Works
1. View Existing Sublimits
From a Borrowing Base or MGLOC loan, go to Settings > Sublimits. Each configured sublimit is listed with the collateral types it covers and its rule in plain language, with Edit and Remove options.
The Sublimits settings page with three ratio sublimits configured.
2. Choose What to Limit
Select Add Sublimit. In step 1, What do you want to limit?, select the collateral types and sales statuses the sublimit applies to, for example, SFR Detached with Presold and Spec. Options are grouped by Single Family Residence, Land, and Projects.
Step 1: selecting the collateral types and sales statuses to limit..
3. Choose the Limit Type
In step 2, Choose Limit Type, select how the sublimit is measured. Commitment-based options cap dollar amounts; count-based options cap the number of collateral items. The two new ratio types are marked with a Type A to Type B Ratio badge:
Ratio Limit Type | Use When |
|---|---|
Number of [Type A] should not exceed ___ for every ___ [Type B] in the subdivision of ___. | The covenant applies to a specific subdivision or community. |
Number of [Type A] should not exceed ___ for every ___ [Type B]. | The covenant applies across the whole loan. |
Step 2: the limit type options, including the two Type A to Type B Ratio types.
4. Configure the Limit Values
In step 3, Configure Limit Values, fill in the rule: pick the Type A collateral (the type being limited), enter the maximum, enter the per-count of Type B, pick the Type B collateral, and, for the subdivision version, search for and select the subdivision. Select Add Sublimit to save. A Sublimit rule created. confirmation appears, and the new rule is added to the list.
Step 3: a rule limiting Spec homes to 1 for every 4 Presold homes in the Sauls Landing subdivision (from the demo recording).
5. Monitor Compliance
On the loan Overview, the Limitations table lists every sublimit alongside Total Commitments. Toggle between Active and Active + Pipeline to include pipeline collateral. For each ratio sublimit, the table shows:
Column | What It Shows |
|---|---|
Limit | The rule, with a green check if in compliance or a red alert if over the limit. |
Collateral / Project Type | The collateral types the rule covers. |
Limit (value) | The allowed ratio, shown as a decimal and as the configured counts, e.g., 0.25 (1:4). |
Current | The current ratio and the counts of each type, e.g., 1.6 (1:0.62), 8 Spec · 5 Presold. |
Remaining | How many units are over the limit, and the maximum allowed for the limited type. |
The Limitations table on the loan Overview, showing one ratio sublimit in compliance and several over the limit (from the demo recording).
6. Review Warnings When Updating Collateral
When a change on the Collateral tab affects a ratio sublimit, for example, converting a lot or changing a sales status, a Confirm Changes dialog lists each affected rule with its resulting ratio and counts. Rules still in compliance are marked in green; rules that would be over the limit are marked in red. Select Confirm & Continue to save the change, or Cancel to go back.
Note:
The Confirm Changes dialog is a warning only. Breaching a sublimit does not block the change from being saved.
The Confirm Changes dialog showing the effect of a collateral change on each ratio sublimit (from the demo recording).
Benefits
Track spec-to-presold and similar ratio covenants in Built instead of a separate spreadsheet.
See compliance for every sublimit at a glance on the loan Overview.
Catch a potential breach before a collateral change is saved, not after.
Scope covenants to individual subdivisions when terms differ by community.
Best Practices
Use a ratio sublimit to control inventory mix. Set a limit on how many units of one collateral type you can have for every unit of another, such as "no more than 1 Spec for every 4 Presold." Ratio sublimits are count-based, so they measure units, not dollars.
Use the subdivision version of the ratio type when a covenant applies to a specific community, and the loan-wide version when it applies to the whole line.
Use Active + Pipeline on the Limitations table to see how upcoming collateral would affect compliance.