Construction Draw Package Guide

When you took out a fix-and-flip, ground-up construction, or rehab bridge loan, the lender funded the purchase plus a "holdback" — the portion of the loan reserved for rehab or construction. That holdback isn't sitting in your bank account. It's held by the lender and released in stages as the work gets done.

A draw request is how you ask the lender to release the next chunk. It's not "send me my money." It's a complete documentation package proving that:

• • Specific work has been completed (verified by an inspector)
• • The contractors who did the work have been paid (or are about to be)
• • Those contractors waive their right to file a mechanic's lien for that work
• • The work matches the scope of work and budget in your original loan file

Every doc in a draw package serves one of those four functions. If you submit something that doesn't, expect it back.

A standard draw package looks like this. Order matters — package them in this sequence and the inspector / fund-control rep doesn't have to hunt for anything.

1. Draw request cover sheet

Lender-provided form or one you've built. Must include:

• • Borrower / entity name + loan number
• • Property address
• • Draw number (Draw #1, Draw #2, etc.)
• • Draw amount requested
• • Cumulative funded to date + cumulative requested through this draw
• • Your signature attesting the figures are accurate

One page. Goes at the front of the package. Most lenders provide a template — use it instead of inventing your own.

2. Line-item budget reconciliation

This is the bookkeeping layer that ties your draw to the original budget. A spreadsheet (or AIA Form G702 / G703 if your lender uses AIA) with columns:

• • Trade / line item (matching exactly the original scope of work)
• • Original budget amount
• • Previously requested
• • This draw
• • Cumulative through this draw
• • Remaining balance
• • Percent complete

The most common reject reason: line items on the reconciliation don't match the original budget. If your original SOW says "framing — $42,000" and your draw says "rough construction — $38,000," that's a rejection. Use the original line-item names verbatim.

3. Invoices, grouped by trade

Now the actual invoices. Group them under the same trade headings used in the budget reconciliation. So all framing invoices sit behind the "framing" tab, all plumbing invoices behind "plumbing," etc.

Each invoice must show: contractor name, contractor's contact info, invoice number, invoice date, scope of work in plain language, dollar amount, and whether it's been paid or is to be paid from this draw.

Don't: send invoices in random order, or send screenshots, or send invoices that just say "labor" without a description, or send a single PDF labeled "all invoices.pdf" with no organization. This is the single most common version of "loose PDF of invoices that someone thought was a draw request."

4. Lien releases

The legal piece. A mechanic's lien is a contractor's right to put a claim on the property if they don't get paid. The lender absolutely will not release funds without releases from contractors who have already done work.

Two types:

• • Conditional lien release — "I waive my lien rights conditioned on receipt of $X." Used for contractors being paid from this draw. Signed before the contractor receives the funds.
• • Unconditional lien release — "I have been paid $X and waive my lien rights." Used for contractors who were paid in the previous draw. Signed after they've actually received the money.

So a typical Draw #2 package includes unconditional releases from contractors paid in Draw #1, plus conditional releases from contractors being paid in Draw #2. Draw #1 only needs conditionals because there's no prior draw to reconcile.

Use the lien release forms required by your state — most states have a specific statutory form. California, Arizona, Florida, Nevada, Texas all have their own versions. Generic forms get rejected by title companies.

5. W-9s for any contractor receiving direct payment

If the lender will pay contractors directly (some do, especially for larger trades like framing or plumbing), each contractor needs a W-9 on file. Some lenders require W-9s for every paid contractor regardless of who cuts the check.

Standard IRS Form W-9, signed and dated. Easy to get from any contractor — they fill these out for tax reporting anyway.

6. Inspector / fund-control report

This is usually not something you submit. It's something the lender (or their fund-control company) generates after a site visit. They send an inspector to verify that the work you're claiming is complete is actually complete and conforms to the SOW.

What you submit alongside is the request for inspection — tell the lender or fund-control vendor that you're ready for an inspection. They schedule, inspect, generate the report, and attach it to your draw file.

Timing reality: inspection lag is the single most-underestimated piece of the draw timeline. From "I'm ready" to "report on file" is typically 3–7 business days. Plan contractor payments around this, not against it. Don't promise your framer they'll be paid Friday if you requested inspection Wednesday.

7. Photos of work in place

Multiple lenders ask for borrower-supplied photos in addition to the inspector report. Easiest format:

• • A photo of the work for each major trade line item on this draw
• • Labeled with the line item and date taken
• • Compiled into a single PDF

These help when the inspector misses something or the report is ambiguous. They're also useful if you ever need to defend the draw timeline downstream.

Standard timeline from submission to funding:

1. Day 0 — Submit. You send the complete draw package to your loan servicer / draw administrator. Email or secure upload, depending on lender. Note the date and any reference number they return.
2. Day 1–2 — Initial review. Draw admin checks package completeness. If something's missing (no lien releases, line items don't match, missing W-9), you get a "please provide X" email here. This is where most of the back-and-forth happens.
3. Day 2–4 — Inspection ordered. Once the package looks complete, the lender or their fund-control vendor schedules an inspector. You confirm site access, lockbox code, or meet the inspector.
4. Day 4–7 — Inspection happens. Inspector visits, photographs work, completes report. Some reports are same-day; some are 2-3 days after the visit.
5. Day 7–10 — Approval + funding. Draw admin compares inspector report to your draw amount, approves what's verified, possibly haircuts the amount if work isn't as far along as you claimed. Funds wire to you or directly to contractors.

A clean package with everything in order: 7–10 days. A package with two rounds of "please send X" back-and-forth: 14–21 days. A package that triggers a complete rework: 21–30 days. Bringing the right doc set the first time is the single highest-leverage thing you can do for your project's cash flow.

These come up over and over again across lenders. Avoiding them is most of the battle.

"Loose PDF of invoices"

The single biggest one. Borrower sends ten unrelated invoice PDFs and a one-line email saying "draw request." No cover sheet, no reconciliation, no releases. Auto-reject. Always.

Line items don't match the original SOW

Your original scope of work said "rough framing $42,000" and "finish framing $18,000." Your draw says "carpentry $55,000." Even if the math works out, the mapping fails and gets kicked back. Use the original line-item names verbatim.

Missing unconditional release from prior draw

You requested Draw #1, got paid, paid your plumber. Now you're requesting Draw #2. The lender asks: "I see you paid Plumber X $8,000 in Draw #1 — where's their unconditional release?" You forgot to collect it. Now you're calling the plumber begging for a release before they can fund Draw #2. Lesson: collect unconditional releases right after each payment, not weeks later when you need them.

Wrong state's lien release form

A California release form on a Texas property gets rejected by the title company. Each state's mechanic's lien law has its own statutory language. Use the form for the state where the property is located, not where you live.

Inspector can't access the site

You submitted the package, lender ordered inspection, inspector showed up and the lockbox code didn't work. Now it has to be rescheduled. Adds 3–5 days. Confirm access immediately when the inspection is ordered.

Requesting more than work-completed-to-date

You think the framing is 75% done, so you request 75% of the framing line. The inspector says it's 60% done. The lender pays 60%, not 75%. Now you have a $5,000 funding gap to your framer. Be honest about percent complete. Underclaim rather than overclaim.

Permits not pulled or expired

Some lenders won't release framing or rough-electrical draws without proof the underlying permits are active. If permits expired since closing, renew them before requesting the corresponding draw.

• Set up a draw template before Draw #1. Build your cover sheet, your reconciliation spreadsheet, and your invoice-grouping structure before you've done any work. Every subsequent draw is a copy of the template with new numbers. You'll cut your prep time from a day to an hour.
• Pay contractors via wire or check, not cash. Cash payments can't be reconciled to lien releases the same way. The lender's paper trail wants documented, traceable payment.
• Collect unconditional releases at payment time. The moment a contractor receives funds from a prior draw, they sign an unconditional release. Don't wait — collect it on the spot. Trying to track them down weeks later is how borrowers stall their own projects.
• Photograph as you go. A weekly walk-through with timestamped photos of each major work area gives you a backup story when an inspector questions a percent-complete claim.
• Build a relationship with your fund-control rep. Most lenders use a dedicated fund-control company. Get on the phone with your assigned rep early. They can tell you exactly what they want to see, and a clean submitter gets prioritized.
• Don't submit Draw #2 before Draw #1 is funded. It might seem efficient. It's not. The lender wants the prior draw fully reconciled before the next one starts.

• Size your fix-and-flip or construction loan →

  Estimate LTV / LTC / LTARV math and the holdback amount you'll be drawing against. Closed-form cost-basis solving so the numbers actually work.

• Build your full document checklist →

  Personalized checklist of every doc your construction file will need — including the upstream items (scope of work, GC contract, builder's risk) that feed into every future draw.

This guide is synthesized from publicly-available draw-administration guidelines published by hard money and construction lenders (RCN Capital, Easy Street Capital, Stormfield Capital, AAPL educational materials), state mechanic's lien statutes (CA, TX, FL, AZ, NV), and AIA G702/G703 application-for-payment standards. Full citations in our sourcing audit trail.

Not legal advice. Mechanic's lien rules, waiver forms, and contractor licensing vary by state. For specific contract, payment, or lien-release questions, consult a construction attorney licensed in your state. We can't replace that conversation.