Financing for contractors and construction businesses
Contractors carry the cost of a job — payroll, materials, subs — long before the progress draw or holdback is released, which is why cash flow, not profit, is the usual squeeze. Working capital, a line of credit, and construction invoice factoring each bridge that gap. Crewline matches Canadian contractors and construction businesses to lenders that understand holdbacks and draw schedules.
The contractor cash-flow problem
Construction runs on other people's timelines. You pay crews weekly, buy materials up front, and carry subs, but you're paid on progress draws that arrive in stages — and a holdback (often around 10%) sits locked until substantial completion, sometimes months after your costs are spent. A profitable contractor can still run dry mid-project simply because money goes out faster than it comes in. That timing gap, not a lack of margin, is what stalls trucks, delays payroll, and forces good contractors to turn down the next job.
Working capital for contractors
Working capital financing covers the operating gap directly — payroll between draws, a big material order before you've billed for it, mobilization costs on a new site. It's sized to your revenue and cash flow rather than to collateral, so a contractor with steady billings can access meaningful funds without pledging equipment. Because it's short-term, it's meant to be repaid as the draw or holdback lands, turning a cash-flow crunch into a manageable bridge. Used against a signed contract with a known payment schedule, it lets you take work you'd otherwise have to pass on.
Construction invoice factoring
If the squeeze is specifically slow-paying general contractors or owners, construction invoice factoring turns those progress billings into cash now — a factor advances most of the invoice and collects when the GC pays. It scales with your billings and doesn't add debt, which suits subcontractors growing faster than a bank will lend. Construction factoring has wrinkles worth knowing — holdback treatment, progress-billing verification, and lien considerations — so it pays to work with a factor who understands the trade rather than a generic one.
Lines of credit for seasonal and lumpy work
A business line of credit is a standing buffer for the routine ups and downs of a construction year — a slow winter, a gap between projects, a draw that lands late. You draw when costs spike and repay as billings clear, paying interest only on what's outstanding. For contractors, a line pairs well with project-specific working capital: the line handles the everyday swings, while a term advance covers a larger, one-time push. Together they keep payroll and suppliers current without forcing you to float everything from your own reserves.
What lenders look at for contractors
Lenders financing contractors look at revenue and deposit consistency, time in business, existing debt, and the quality of your receivables — who owes you and how reliably they pay. Signed contracts, a clear draw schedule, and a clean accounts-receivable aging strengthen the file, because they show the lender exactly where repayment comes from. Credit matters but rarely decides it on its own. Presenting the job pipeline and payment terms clearly is often the difference between an approval and a decline, since it turns "trust me" into a documented, fundable request.
Financing the work vs financing the equipment
There's a clean line between the two needs. Covering payroll, materials, and the holdback gap is capital financing — working capital, a line of credit, or factoring — which is what Crewline arranges. Buying the excavator, skid steer, or truck itself is asset financing, which uses the machine as collateral for a lower rate over a longer term, and that routes to our sister brand IronFinance. Keeping them separate gets you the right structure for each: don't burn short-term working capital on a long-lived machine, and don't tie up equipment financing to cover this week's payroll.
Timing financing to your draw schedule
The contractors who use financing best treat it as a scheduling tool, not an emergency measure. Before a project starts, map the real cash timeline: when payroll and material costs hit, when each progress draw is expected to clear, and when the holdback releases. That map shows the size and duration of the gap you actually need to bridge — and it's exactly what a lender wants to see, because it turns a vague request into a documented, repayable plan tied to a signed contract. Line up the financing before mobilization rather than scrambling once you're already short, when options narrow and pricing worsens. A line of credit drawn against a known draw schedule, or a working-capital advance timed to a specific holdback release, keeps crews paid and suppliers current without eating your reserves. The habit compounds: contractors who plan the cash side of each job the way they plan the build take on larger projects with confidence, stop turning down work they can't front, and present cleaner files that earn better terms over time. Crewline can help you line up the right facility against a specific contract and draw schedule before the job starts. Cash-flow planning, not just good bidding, is what lets a construction business grow without stalling.
What lenders look at
- Revenue and deposit consistency
- Signed contracts and draw schedules
- Accounts-receivable aging and who owes you
- Time in business
- Existing debt and repayment history
- Holdback and progress-billing details
Frequently asked questions
- How do contractors finance payroll between draws?
- Usually with working capital or a line of credit sized to revenue, repaid as the progress draw or holdback lands — bridging the gap between paying crews now and getting paid in stages.
- Can I factor construction progress invoices?
- Yes. Construction invoice factoring advances most of a progress billing and collects when the general contractor or owner pays. Holdback and lien treatment vary, so use a factor who knows the trade.
- Does financing for contractors cover equipment?
- No — that's asset financing, which uses the machine as collateral. Crewline covers capital financing (payroll, materials, cash flow); equipment routes to our sister brand IronFinance.
See what type of financing may fit
A few questions about your business — takes about 3 minutes.
See what you may qualify forCrewline is a referral and matching service, not a lender. We do not make credit decisions or guarantee approval. Financing is provided by third-party lenders subject to their own terms and criteria.