The draw schedule is the heartbeat of a construction loan. Understanding how draws work helps developers keep cash flowing and avoid delays. Here is how it works.
What a draw schedule is
A draw schedule sets out the stages at which the lender releases construction funds — for example after foundation, framing, lock-up and completion. Each draw corresponds to verified progress.
The inspection and verification step
Before each advance, the lender usually requires an inspection or progress report, often by a quantity surveyor or cost consultant, to confirm the work is complete and the budget is on track. This protects both the lender and the project from cost overruns.
Managing cash flow between draws
Because funds arrive after work is done, builders must manage cash flow and supplier payments between draws. Ontario’s construction lien holdback requirements also affect timing and need to be planned for.
Keeping it on schedule
Accurate budgeting, prompt documentation, and a lender experienced with your project type keep draws flowing without delays. Structuring the right schedule up front prevents funding gaps mid-build.
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