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Construction Business Loans

For Your Construction Company.

How much are you looking for?

price

With SMB Compass, the entire loan process is conducted online — quickly, simply, and securely

Flexible

From $25,000 to $5,000,000, with terms up to 10 years

Fast

Funding in as soon as 24 hours

Flexible

Competitive fixed rates,no collateral, no surprises

Benefits of working with SMB Compass

  • Successful track record of supporting small businesses

  • Free consultations to discuss financing options

  • 5 Star Customer Reviews

  • Over $160 million delivered to 1,100+ small businesses

  • 10+ years of business lending expertise

  • Flexible and low cost options available

Financing for the Construction Industry

The construction industry is notorious for being capital intensive. Running your own construction firm takes hard work, expertise, and a lot of resources. Contractors always need capital available to start new projects and fund the working capital for existing ones. Contractor financing is important to keep up with the need to purchase materials, buy new equipment, and to hire employees.

It’s commonly known that contractors are always waiting to get paid by their customers. Based on the payment waterfall, sub-contractors are usually waiting for the longest. Most contractors are paid when paid, which means they are not paid until the GC is paid. This typically causes a constant need for working capital to bridge the payment gap.

SMB Compass goes the extra mile to provide you with personalized construction business loans. By using the right financing solution, you can continue to grow your business without thinking about having the capital available to you.

The Best Financial Solutions for Contractors

Construction businesses need working capital to bridge the gap between cash payables and cash receivables. SMB Compass offers construction business loans to contractors in the United States. One of our reliable lending advisors will help you find the best construction business loan specific to your needs.

Bridge Loans for Contractors

A contractor bridge loan is perfect for contractors who need immediate financing. When your business needs to fund a short-term business need, make sure you apply for a loan that offers instant funding, like a contractor bridge loan. The following are some of the reasons why contractors use a bridge loan:

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Bulk Material Discounts

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Mobilization funding

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Leasehold improvements

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Hiring new employees

N

Purchasing equipment

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Transitional financing

Equipment Financing for Contractors

Construction companies rely on heavy equipment, such as loaders, excavators, bulldozers, etc., to conduct daily operations. You can use equipment financing to purchase or rent basic office equipment (phones, tablets, printers, furniture, etc.) to more expensive construction equipment and/or vehicles. Contractors often use equipment financing because of the following:

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Purchase equipment

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Refinance existing equipment

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Update outdated equipment

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Lease new equipment

N

Replace construction software

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Upgrade customer management systems

*Below is a list of common equipment that contractors us contractor equipment financing programs for.

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Consolidate existing debt

N

Purchase new equipment

N

Business acquisition

N

Partner buyout

N

Debt refinance

N

Upgrade equipment

N

Purchase commercial real estate

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Refinance existing real estate mortgage

N

Leasehold improvement

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Business expansion

SBA Loans for Contractors

SBA loans for contractors are widely used by construction firms. Utilizing SBA loan programs for contractor’s business owners are able to take advantage of long terms, low rates, and low monthly payments. Here’s a list on how you can use an SBA loan for the construction industry.

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Loader Financing

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Excavator Financing

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Dozer Financing

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Truck Financing

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Crane Financing

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Equipment Management Software Financing

N

Dump Truck Financing

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Air Compressor Financing

N

Welding Equipment Financing

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Backhoe Financing

N

Wood Chipper Financing

N

Forklift Financing

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Concrete Paver Financing

Business Lines of Credit for Contractors

Construction companies use a business line of credit for daily business operations. With this type of loan, you don’t have to pay for the entire line of credit. You only need to repay the money you’ve withdrawn, plus the interest. Contractors commonly use a business line of credit for the following:

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Purchase supplies

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Advertising and marketing

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Day to day operating cashflow

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Purchase equipment

N

Leasehold improvements

N

Mobilization funding

Asset-Based Loans for Contractors

Does your business own high-value assets? You can free up working capital and use those assets to your advantage. An asset-based loan allows you to secure financing by putting up company assets (equipment, accounts receivable, inventory, etc.) as collateral. Here’s why your construction business should use asset-based loans:

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Increase operating cashflow

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Refinance construction equipment

N

Accelerate invoice payments

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Reduce monthly debt payments

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Purchase new equipment

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Hire new employees

Term Loans for Contractors

Term loans are business loans that charge low monthly payments and have repayment terms that range from one to five years. It’s better for businesses to apply for term loans rather than use their available cash. Contractors can use the funds from a term loan in many different ways, such as:

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Purchase new equipment

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Leasehold improvements

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Refinance existing equipment loans

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Consolidate debt

N

Hire new employees

N

Working capital injection

Construction Factoring for Contractors

Construction factoring is used by contractors to get paid early on invoices. This enables contractors to have cashflow available for day to day operating expenses. By collecting payment on invoice sooner, construction factoring also provides liquidity for:

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Marketing and advertising

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New construction projects

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Business expansion

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Hiring new employees

N

Purchasing materials

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Leasehold improvements

Mobilization Funding for Contractors

Contractors that bid on large commercial jobs are often in need of financing to pay for upfront expenses associated with the new project. Mobilization funding provides capital for expenses incurred before you can invoice your customer. Once you invoice your customer and get paid you can pay back the mobilization financing. Frequently mobilization funding is paired with factoring to help accelerate cashflow throughout the life of the project. Some of the ways you can use mobilization financing are

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Purchase materials

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Labor expenses

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Buy new equipment

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Hire new employees

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Travel expenses

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Design fees

Types of Contractors we Finance

General Contractor Loans

Sub Contractor
Loans

Electrical Contractor Loans

Plumbing Contractor Loans

Foundation Contractor Loans

Framing Contractor Loans

Roofing Contractor Loans

Flooring Contractor Loans

Landscaping Contractor Loans

FAQ About Construction Business Loans

What is a construction business loan?

A construction business loan is financing that provides construction businesses or contractors the necessary capital to take on new projects as well as finish existing jobs. It’s common in the construction industry that there will be long payment terms and financing helps bridge this gap.

How do you qualify for a construction business loan?

The qualifications for a construction business loan are all dependent on the type of financing a business is looking to secure. For a bridge loan or a line of credit, revenue and time in business are important. If a business is looking for invoice financing or factoring the debtor has to be a reliable client with good trade credit history. Longer term financing such as term loans and SBA Loans more have sterner qualifications including a business owners personal credit and guidelines regarding the profitability of the business.

How long does the application process take for a construction business loan?

The timeframe of the application process for a construction business loan varies depending on if a business is looking for short or long term financing. The application process for a bridge loan or line of credit is minimal and will require limited documentation. The application process for long term financing such as equipment financing, asset based loans, and SBA Loans are longer and tend to require significant documentation.

How would you use a construction business loan?

Construction business loans are used for a wide range of different reasons including equipment, labor, and materials. Long payment terms need to restrain cash flow and financing provides businesses with the working capital necessary to operate effectively. Construction financing can also help consolidate existing debt as well as take on larger projects that cannot be possible with the current cash flow.

Is collateral required for a construction business loan?

Collateral may be required for a construction business loan if the financing includes equipment or is stretch out over a long period of time. Equipment financing will require the piece of equipment to be used as collateral. SBA Loans require that any and all available assets be used as collateral while shorter term financing options such as bridge loans and lines of credit may not require collateral.

What are the different construction business loan options?

Since the construction industry is so vast and unique there is a wide range of different construction business loan options to consider. Some of the most common financing options in that construction businesses and contractors use include equipment financing, bridge loans, lines of credit, and factoring. Asset based loans and SBA loans are also common in the industry and very help for business owners.

Interested in learning about your financing options?
Speak with a lending expert today!

Interested in learning about your financing options? Speak with a lending expert today!