Draw & Payment FAQs

Common questions about construction draws, payment schedules, and retainage.

What is a construction draw?

A draw is how you access funds from your construction loan. Instead of receiving the full amount upfront, the bank releases money in stages as work is completed and inspected.

How many draws can I request?

Typically 4-6 draws aligned with major construction milestones. Some banks allow monthly draws. Your draw schedule is agreed upon before construction starts.

What is retainage?

Retainage is a percentage (typically 5-10%) that your bank holds back from each draw. This money is released after the project is fully complete and passes final inspection.

How long does it take for a draw to be funded?

Most banks process draw requests in 5-10 business days after receiving complete documentation. Submit your draw request as soon as the milestone is reached.

What happens if my draw is rejected?

Read the bank's feedback, address each issue, update your documentation, and resubmit. Common reasons for rejection include missing lien waivers, incomplete documentation, or draw amounts that don't match inspection results.