Construction Business Financing up to $650,000
Applying for a construction business loan is a significant financial decision. We’ve already helped lots of construction companies to prosper and can approve up to $650,000 within 48 hours. Apply Now. Check how much you can get now with no obligations, no fees, and no impact on your credit score.
Construction company loans are a type of small business loan that helps construction business owners increase cash flow, accelerate growth, and overcome logistical challenges in day-to-day business operations.
What Are Construction Company Loans?
Construction company loans help contractors in the construction industry fund their operations. Having access to funding helps construction businesses cover unexpected expenses and maintain operations.
Construction companies can bid on new jobs, buy heavy machinery, and fix cash flow gaps through construction financing.
Types of Funding for Construction Companies
There are a variety of funding solutions available for construction companies that are looking to sustain or grow their operations. Merchant Cash Advances allow contractors to borrow money against their future earnings. These are paid back through a percentage of sales.
For construction businesses that need to access flexible financing, a business line of credit can provide access to a revolving line of credit, much like a credit card. You’ll only pay interest on the amount that you borrow, and the line of credit becomes available again as the balance is paid back.
Small business loans are traditional installment loans that offer construction companies a lump-sum payment with fixed monthly repayment turns, typically repaid over 1 to 5 years. Alternative loan types include SBA 7(a) loans, which can be borrowed with few restrictions and longer repayment terms, up to 10 years.
If your construction business needs new equipment, consider equipment financing. This allows you to purchase new equipment, which may help you increase revenue or offer new services. The equipment typically serves as collateral for the loan, and repayment periods typically last a few years, allowing the equipment to pay for itself.
Lastly if you find yourself short on cash due to unpaid invoices, construction companies may utilize invoice financing to gain access to cash in advance of their customers making payment. This arrangement allows up to 80% of the invoice value to be received in exchange for a small fee.
How Do Construction Company Loans Work?
Construction business loans work just like loans for any other industry. When a construction company owner gets approved for a loan, the lender gives them a lump sum payment for the amount they got approved for.
After the funds are in the construction company owners bank account, loan repayments begin. Repayments are made monthly and are fixed amounts designated in the loan agreement.
Ways to Use Construction Company Business Loans
While some small business loans like the SBA 504 restrict how a construction company may use funds, most do not. Most construction business funding can be used for anything in the construction industry.
Among these costs are raw materials, cash flow maintenance, billing cycles, taxes, heavy machinery, contractor expenses, marketing campaigns, and other common construction business expenses.
How to Qualify for a Commerical Construction Loan (With the Best Rates)
Financial institutions look at several key factors when deciding what rate to charge a potential borrower. These factors include the construction company’s credit score and the credit score of the owner. How long the construction company has been in business and the loan term is also considered.
A commercial construction loan can really help with growth but monthly loan repayments can be a burden on low profit companies. The interest rate and payment amount are often the deciding factors for whether or not to take out financing.
Even though some of these figures are out of your control, having a good credit history is really helpful and will save money in the long haul.
How to Apply for the Best Construction Business Loan
Eligibility Requirements
To be considered by mCashAdvance™, you must meet the following requirements:
- A U.S. citizen or legal resident
- Minimum age of 18 is required
- Your construction business must be at least six months old
- A minimum credit score of 500 or higher
Loan Limits
Construction business funding through mCashAdvance™ is available up to $500,000, depending on individual business needs.
Term Lengths
Depending on the amount funded and individual agreement, the typical length for repayment is one to five years.
What Are the Benefits of Getting a Loan for Construction Companies?
Benefits
Using a loan strategically can scale a construction companies operations and fuel rapid growth. Compared to other forms of financing, loans often offer lower rates. Collateral secured by the purchased equipment makes equipment loans one of the most accessible types of loans.
Drawbacks
Newer construction companies with the most financial needs get frequently rejected due to lack of history. Additionally, SBA loans can take weeks or months to process with no approval guarantee. Finally, if an owner manages to get approved, there may be restrictions on where and how to use loan funds.
Construction Company Loans Frequently Asked Questions
Conventional loans from traditional banks or credit unions can have annual percentage rates (APRs) ranging from 4% to 13%. Alternative lenders can have loan APRs ranging from 7% to over 100%. The interest rates you are charged will depend on the strength of your loan application and the amount of money you would like to borrow.
The most common reason banks decline construction loan applications is due to pre-existing debt. Insufficient collateral and low credit scores are also common reasons for rejection.
Eligibility requirements for loans vary, but there are a few similarities that all lenders like to see. It is usually necessary for a business to be in operation for two years or more, have a good credit history and annual profit/loss statements. Meeting most of the requirements will give your business the best chances for loan approval.
Getting approved for construction business loans can be challenging. Having good credit history and satisfactory business operations are good places to start. For those who are having trouble, merchant cash advances, lines of credit, and invoice financing may offer alternatives for quick financing with less stringent criteria for approval.
Collateral is sometimes required for loans for construction companies due to the high loan amounts. Assets like equipment, real estate, land, and accounts receivables can be used to secure loans. Alternatives such as merchant cash advances do not require collateral
Funding Your Business Is Our Business
Construction Company Loans Can Help Grow Your Business
Many lending options are available to help those in the construction industry protect or scale their businesses. Contact mCashAdvance™ to apply for financing or speak with an advisor to learn more about our innovative funding options.
Does Your Business Need Funding Today?
There’s no fee or obligation, and it won’t impact your credit.
$5,000 – $1,000,000
Talk to a rep at (855) 433-8641
Mon – Fri | 9:00am – 8:00pm