Construction Financing

Whether you're bidding on a project with 60-day mobilization costs, financing a new excavator, or smoothing payroll across a slow winter, here's how lender underwriting reads a contractor's file in 2026 — and which product fits which problem.

Construction businesses face a particular underwriting challenge: revenue is lumpy, receivables are slow, and the gap between mobilization costs and final draws can stretch your operating account thin even on a profitable project. Lenders who specialize in trades read your bank statements differently than a generic small-business underwriter would. ClearValue Lending routes contractor files to lender partners who understand the construction revenue cycle.

Which financing product fits which construction problem

The right product depends on what you're actually trying to fund. Match the use case to the product structure:

Project mobilization (60–90 day gap between start and first draw): Business line of credit is usually the cleanest fit. Draw what you need at job start, pay it back when the customer pays, only pay interest on the drawn amount. Better than tying up a term loan in cyclical use.
Equipment purchase (excavator, trucks, lifts, specialty tools): Equipment financing — collateralized by the equipment itself, often $0 down for strong credit, 24–84 month terms. Lower rates than unsecured products because the lender holds title until paid off.
Payroll bridge in a slow month / seasonal trough: Revenue-based financing (MCA) for fast funding (1–3 days), or a line of credit if you have time to apply. Term loans are usually wrong here — paying fixed monthly installments on a one-time bridge is overkill.
Large one-time investment (yard expansion, fleet refresh, business acquisition): Term loan ($25K–$500K from non-bank lenders, higher from banks) or SBA 7(a) if you have 24+ months in business and time for 60–90 day underwriting — including the CAPLines Contract variant built for mobilization against awarded contracts.
Bonding capital / working capital reserve for bid qualification: Line of credit or term loan depending on whether the requirement is access-to-capital or actual cash-on-hand.

What contractor underwriting actually looks at

Construction underwriting is more nuanced than "bank statements + FICO." Specialist lenders also weigh:

Receivables aging — how much is outstanding, who owes it, and how reliable that customer is at paying
Project pipeline — backlog of signed contracts vs. spec/bid work
Subcontractor vs. employee mix — affects both cost structure and how lenders interpret payroll
Type of work — government / municipal contracts read differently than private residential; commercial differs from spec building
Bonding history if you've worked bonded projects
License standing and state contractor board status

Documents to assemble before applying

3–6 months of business bank statements (PDFs from the bank portal, not screenshots)
Year-to-date P&L + balance sheet dated within 60 days — critical for term/line/SBA, optional for MCA
Last 2 years of business tax returns (3 for SBA)
Aging receivables schedule — list every open invoice with customer, amount, days outstanding
Current debt schedule — every loan, line, equipment lease, MCA
Contractor license + current state-board status
Articles of formation + EIN letter + driver's license for each 20%+ owner

How ClearValue routes contractor files

ClearValue Lending is a funding platform. We evaluate lender partners against our underwriting and conduct standards, take in your application, and route to the partner most likely to fund based on your specific file. For construction we have partners that specialize in: equipment financing across all major trades, lines of credit for project mobilization, term loans for one-time expansion, and revenue-based financing for fast-bridge needs. The lender presents the offer directly to you and handles all approval, underwriting, and funding.

Construction industry data

U.S. construction put-in-place exceeded $2.1 trillion in 2024 — residential, nonresidential, and public-works segments each drive distinct financing demand patterns. — U.S. Census Bureau — Construction Spending (C-30)
SBA 7(a) loan program is the primary federal small-business financing channel; contractors with 24+ months of profitable operating history and 680+ FICO are generally eligible for amounts up to $5 million. — SBA.gov — 7(a) Loans
Federal Reserve Small Business Credit Survey 2024 reports small banks approved 57% of SMB loan applications — the highest approval rate of any lending channel for construction and trade businesses. — Federal Reserve Small Business Credit Survey

Frequently asked questions

Can I get a business loan if my construction company is less than a year old?

Yes — but options narrow. With under 12 months in business you're typically constrained to revenue-based financing (MCA), some non-bank lines of credit, and equipment financing collateralized by what you're buying. Bank lines, traditional term loans, and SBA loans typically require 12–24 months minimum. Real apply-stage answer comes from underwriting on the specific file.

What credit score do I need for a construction equipment loan?

Most non-bank equipment lenders work with personal FICO 600+, though 550–600 is possible at higher rates. Bank equipment financing typically requires 650+. The equipment serves as collateral, so credit floors are often lower than for unsecured working-capital products.

Will the lender finance against my open receivables?

Receivables-based financing (factoring or A/R financing) is a separate product family that advances funds against unpaid invoices. Some lenders in the ClearValue partner network offer it; whether it fits depends on your customer mix and invoice terms. For most contractors, a line of credit is simpler than dedicated factoring.

How fast can a construction business get funded?

Revenue-based financing: as fast as 24–48 hours after a complete application. Equipment financing: 3–7 days typically. Bank line of credit: 1–4 weeks. SBA 7(a): 60–120 days. These are network-level ranges, not per-applicant promises — your actual timeline depends on file completeness and lender underwriting.

Do I need to disclose my existing MCAs when applying?

Yes — every active funding agreement must be disclosed on the debt schedule. Underwriters pull bank statements; existing MCA debits show up there even if you don't disclose. Hiding obligations gets the file declined or, worse, funded then rescinded mid-process. Disclosure up front lets the lender price for it.

Apply for construction financing — see your options