How to Set Up a Construction Loan Draw Schedule With Your Lender

A construction loan draw schedule is the plan for when your lender releases money and how much, tied to stages of the build. Set it up before the loan closes, match each draw to work an inspector can see, and plan your cash for the wait between finishing a stage and getting paid.

By Smart Builder 360 Team  |  Principal Contributors: Dave Daugherty & Kurt Shank  |  Updated: October 4, 2026

What Is a Construction Loan Draw Schedule?

A construction loan does not pay out all at once. The lender releases it in pieces, called draws, as the house gets built. The construction loan draw schedule is the plan behind that. It lists each stage of the job and how much money is released when that stage is done.

The lender cares about it because it protects them. They only pay for work that is actually in place. You should care about it because it decides when you get paid. A good schedule keeps money coming at the pace you spend it. A bad one leaves you paying crews out of your own pocket for weeks.

If you are new to draws, read our plain-English guide to what a draw request is first.

Step 1: Get Your Lender's Draw Rules Before the Loan Closes

Every lender runs draws a little differently. Before the loan closes, ask for three things in writing: their draw form, their inspection process, and how long it usually takes to fund a draw after an inspection.

Ask too whether they hold back part of each draw until the end. That held-back money is called retainage, and you need to plan for it. Once you know their rules, you can build a schedule that fits them instead of fighting them later.

Step 2: Start From Your Estimate and Budget

Your draw schedule should come from your estimate, not from round numbers. Go through the job phase by phase: site work, foundation, framing, roofing and so on. Add up what each phase really costs you.

This is where a good estimate pays off. If your estimate is organized by phase and cost category, building the draw schedule is mostly a matter of grouping lines together. If it is one big number, you will be guessing, and guesses tend to come back as rejected draws.

Step 3: Tie Each Draw to a Stage the Inspector Can See

The lender's inspector has to be able to walk the site and confirm the stage is done. So pick stages that are easy to see. Foundation poured. Framing complete. Roof on and windows in. Rough-ins done and passed.

Avoid stages that are hard to check, like "50 percent of interior work". Two people can look at the same house and disagree on what half done means. A stage the inspector can see with their own eyes is a stage that gets paid.

Step 4: Match the Money to the Work

Now put a dollar amount on each stage. The money for a stage should match the cost of the work in it, as closely as you can. Lenders do not want to pay ahead of the work, and they will notice if an early stage is loaded with more money than it needs.

At the same time, look at your own costs. Some stages cost a lot up front, before anything is visible. Material orders, deposits and site work can all land early. Know where you will be short of cash and plan for it now, not in the middle of the job.

Make sure the stages add up to the full loan amount. It sounds obvious, but a schedule that does not add up is an easy way to get a draw sent back.

Step 5: Agree on the Paperwork for Every Draw

Every draw request needs backup. Most lenders want invoices, photos of the work, and lien waivers from the subcontractors and suppliers who were paid. Many also check the title for new liens before they release money.

Agree on this list up front and keep a folder for each stage as you go. When the stage is done, the paperwork is already together. Our guide to what documents lenders require covers the full list.

Step 6: Plan for the Gap Between Finishing and Getting Paid

There is always a gap between finishing a stage and seeing the money. The inspector has to come out, the lender has to review the request, and then the funds are sent. How long that takes depends on your lender, so ask them, and read our breakdown of how long a construction draw takes.

During that gap, your crews and suppliers still expect to be paid. Keep enough cash to cover at least one stage of work while you wait. If you cannot, talk to your suppliers about terms before the job starts, not after a payment is late.

Draw Schedule Example

Here is a simple example of a construction loan draw schedule, with example numbers only. Your lender's stages and percentages will be different.

• Foundation complete: 15 percent of the loan
• Framing complete: 20 percent
• Roof on, windows and doors in (dried in): 15 percent
• Rough-ins done and inspected: 15 percent
• Insulation and drywall complete: 10 percent
• Finishes, cabinets and trim complete: 15 percent
• Final inspection and certificate of occupancy: 10 percent

On a $400,000 loan, also an example, the framing draw would be $80,000. Notice that every stage is something an inspector can see, and the stages add up to the whole loan.

Common Mistakes

The most common mistake is building the schedule around the money instead of the work. A stage loaded with extra money looks fine on paper, but the lender will catch it at inspection.

The second is leaving the paperwork until the stage is done. Missing lien waivers and invoices hold up more draws than anything else. The third is forgetting the gap. Even a perfect draw takes time to fund, so plan your cash for it.

Get the draw schedule right before the loan closes, and every draw after that gets easier.

Frequently Asked Questions