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Financialaka: drawaka: construction drawaka: loan draw

Draw Request

In Plain English

A formal request to a construction lender to release funds to pay for work completed during the billing period.

Definition

A draw request is a formal request submitted by a contractor or developer to a construction lender for disbursement of loan funds to pay for costs incurred during a specific period. Lenders require supporting documentation including a schedule of values, invoices, lien waivers, and a title update. An inspector or lender representative may verify the work in place before approving the draw.

Why It Matters in Bidding

Draw requests govern a contractor's cash flow on lender-financed projects, and a draw that is rejected or delayed for missing lien waivers or documentation can force the GC to carry payroll and supplier costs out of pocket. Estimators and project teams structure the schedule of values during bidding specifically to support clean, front-loaded-where-allowable draws that keep money moving.

Example

A GC's project accountant assembles the monthly draw request with the updated schedule of values, subcontractor invoices, conditional lien waivers, and photos, then submits it to the construction lender ahead of the inspector's site visit verifying work in place.

Related Terms

Payment ApplicationSchedule of ValuesLien WaiverProgress Payment

Frequently Asked Questions

Lenders typically require an updated schedule of values showing percent complete, supporting invoices, conditional and unconditional lien waivers from subs and suppliers, and a title update or endorsement. Many also require an inspection report or photos confirming the work billed is actually in place before releasing funds.
The schedule of values breaks the contract into line items the contractor bills against each period. Each draw reports percent complete per line, and the lender funds the incremental value earned. A well-built schedule from the bid stage makes draws faster to prepare and easier for the lender or inspector to verify.
Common reasons include missing or stale lien waivers, billing ahead of work actually completed, math errors in the schedule of values, or an inspection that does not match the claimed progress. Delays directly hurt cash flow, so contractors track documentation and retainage carefully to keep each draw clean.

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