Best Business Loans for Construction Contractors

Construction companies and specific trade contractors are always in need of capital due to the nature of their business and industry. Getting capital to help run the business is essential for cash flow to balance multiple jobs that are being worked on. Many times you have to purchase supply and meet payroll before funds come in from clients. Traditional banks have always made it difficult to get funding for the business.

AdvancePoint Capital can provide that working capital to construction companies like yours for cash flow, so you focus on running your business and make it grow.

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The 6 Best Business Loan Options for Construction Contractors:

There are many funding and loan options that construction companies can use to their benefit. Contractor loan solutions can assist with a wide range of funding needs. Finding the right loan that works for your business may take some guidance. That’s why we put together the 6 best loan options for construction contractors. Each of these construction loans offers unique benefits and qualities that may work for your company. Take a look.

Short Term Business Loans for Construction Companies

A short-term business loan is a financing option that provides a fixed amount of money, with a fixed cost that is paid back over a term from 6 to 18 months. This product is easier to acquire as the standards are easier for approval than traditional business loans and is a great option for working capital.

Highlights of Short-Term Loans:

  • Allows for substandard business credit with good and bad credit accepted
  • Low monthly or annual revenue requirements
  • Easy Process, Same day to next day business funding available

Business Line of Credit for Construction Companies

A business line of credit has the flexibility that a short term loan does not. It operates more like a credit card in that it operates as a revolving line of credit and allows you to draw money out as needed, and you only pay principal and interest on your outstanding balance.

Highlights of Business Line of Credit:

  • Flexibly of drawing money out when you need it
  • Only required to pay interest on the outstanding principal balance
  • Lower costs and fees than that of other loan options

Equipment Loans for Construction Companies

An equipment loan or financing is used to purchase specific equipment that is put up as collateral as you would when purchasing a truck or automobile. An equipment loan or financing is usually structured as a lease to purchase or fixed-term loans.

Highlights of Equipment Financing:

  • Minimal paperwork require
  • Instant funding
  • Repayment terms from 12 months to 5 years
  • Affordable monthly payments

SBA (Small Business Administration) Loans for Construction Companies

An SBA loan, short for Small Business Administration loan, is a loan guaranteed by the Small Business Administration. SBA is not the lender. This loan program provides long-term, fixed-interest rate financing at very attractive interest rates and terms. This loan product is highly desirable, but the process is lengthy, with a lot of paperwork requirements and high credit standards.

Highlights of Equipment Financing:

  • Low-Interest Rates
  • Repayment terms from 12 months to 25 years
  • Affordable monthly payments
  • Can use the money for various needs of a business

Invoice Factoring / Financing for Construction Companies

Invoice financing, also known as invoice factoring, allows the construction company to leverage outstanding invoices and receive advances off those invoices in a day ahead of the “net” terms of 30, 60, or 90 days the invoices normally take to get paid. This is a great way to get cash flow fast off of work that has been completed but not paid for yet. The product is geared towards business to business only, so unless you have other businesses you invoice, this product won’t be available if your customers are consumers.

Highlights of Invoice Financing:

  • Lightning-fast access to capital
  • Credit requirements based on your customer, not your business
  • No limitations on use of funds
  • No payments, no long term debt obligations

Business Credit Cards

A business credit card is a small plastic card that is issued to a business owner by a financial institution allowing the holder to use the card to purchase or pay for items on demand instantly offline and online. The card operates as a revolving credit line that has a credit limit and charges principal and interest on the balance of the account on a monthly basis. This is a prevalent choice as the card is flexible in repayment with lower monthly payments than business loans.

Highlights of Business Credit Cards:

  • Principal & Interest
  • No prepayment penalties
  • No limitations on use of funds
  • Low monthly minimum payments

Benefits of Constructruction Business Loans

Cash Flow

One of the great challenges of construction businesses is cash flow. Most projects the construction companies and specific trade contractors take on have completion dates and time frames that can fluctuate with delays in and out of their control, causing cash flow unpredictability. Business loans solve that problem by filling immediate issues like customer payment delays, supply and equipment purchases, payroll, and general operating expenses. If you own a construction business, you know how important these loans can be to operational costs, progress, and growth. Contract loans and construction financing options give business owners the freedom to take on new opportunities through smart funding from qualified lenders like AdvancePoint Capital.

Owning Your Own Equipment

Equipment financing allows construction contractors to own their equipment saving money long term on renting equipment for jobs there working on, therefore making higher margins of profit on work. Whether it’s a small business operation or a larger construction enterprise, owning equipment plays a significant role in savings and cost-effectiveness. Regardless of your time in business, considering equipment loans is always a great long-term investment that can make a real impact over time.

Marketing and Advertising

Many contractors need advertising to maintain or grow their customer base. Business loans allow companies to design and optimize their websites on the internet for greater exposure. Other internet methods to acquire customers include Pay per Click Advertising, SEO, and buying leads. Traditional methods like radio, newspaper, and signage may also help grow the business. Business owners and construction leadership can take these small business loans as an opportunity to meet or exceed marketing challenges. While many loans are crafted to serve working capital or other operational costs, funding can also be used for promotional purposes. With the right scope on an ROI, you can use these loans to take advantage of new audiences and customer bases.

Hire Employees and Managing a Growing Team

Hiring a great team is the lifeblood of a construction business. Recruiting can cost a business a lot of money because the workflow is not as steady as other businesses. Salaries and signing bonuses can really burden a business without business financing in place to sure up any cash flow issues. Construction business loans are a great way to grow and utilize funding for onboarding and expansion. Contractor loans offer a ton of flexibility in an industry where the workforce isn’t stagnant, and these construction loans offer a lot more leniency with the hiring and growth process.

Making Payroll

As a business grows, payroll will grow into something that must be managed and maintained with zero tolerance for cash flow shortages. Unexpected issues related to construction company receivables can put a business in a position they can’t afford to be in, which is missing a payroll. Working capital and other operational costs are a necessity for a successful construction business. The right funding option to help with working capital needs is a real game-changer. The wide and diverse range of construction business loans gives business owners the freedom to make sound financing decisions and eliminate payroll as a problem.
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Types of Construction Companies We Serve:

We offer construction business loans to a wide range of industries and companies. We have a wide range of options to help those with limited time in business and a lower credit score. We provide construction loans, lines of credit options, and funding solutions that you can take advantage of today for working capital or a wide range of business needs.

    • General Contractors
    • Plumbing Contractors
    • Electrical Contractors
    • Home Improvement/Remodelers
    • Landscaping Contractors
    • HVAC Contractors
    • Residential House Builder
    • Commercial Building Contractors
    • Construction Manager
    • Sub-Contractors
    • Demolition Contractors
    • Property Maintenance Contractors

Get started today. We offer a wide range of construction loans and lines of credit options that you can take advantage of for your construction business — regardless of your credit score or history. Finding the right funding solution can be difficult, but here at AdvancePoint Capital, we make it easy.

Why AdvancePoint Capital?

We’ve helped countless construction companies find the loan option that works best for their business. Our simple diverse range of construction loans and funding opportunities gives our customers the freedom and flexibility to find a loan solution that works for their small business. Our simple application process and instant cash on hand experience are just around the corner.

With AdvancePoint Capital, you’ll get the benefit of construction industry professionals, experience, specialists, and a trusted name in the funding industry. We make it easy to get started.

  • Experience- with Construction Industry. We have been funding construction businesses for years.
  • Trust-Excellent reviews and feedback from Construction Companies 
  • Loan Specialists –Experiences Business funding specialists who know the construction industry.
  • No cost, no commitment quotes
  • Products – A Variety of Construction Business Loan Products. We don’t just offer what we have; we offer what’s available in the marketplace.

Construction loans can be intimidating, but they don’t have to be. Credit history, time in business, and financial documentation may seem daunting — but with AdvancePoint Capital, we find a funding solution that works with your construction company instead of against it.

Frequently Asked Questions

Are construction loans difficult to obtain?

This may depend on which type of loan you’re looking for for your construction business. Luckily, there is a wide variety of options for you to choose from, each with different qualifications so that you can discover a solution that works for you. The right funding option may come down to credit score or how long you’ve been around as a business.

Can I qualify for a construction loan if I have bad credit?

Yes, there are funding options that you can take advantage of even if you have a poor credit history. A business line of credit, shorter-term options, and invoice financing are some great options for those struggling with creditworthiness.

Can I get a startup construction loan?

It is possible to obtain a startup loan for a construction company, but the options may be more limited and difficult to qualify for. The SBA has some incredible funding opportunities for startups. However, SBA funding is not easy to qualify for and may require great credit.

What’s the best construction loan for my business?

That depends on a wide range of factors, including how long you’ve been a company, what you need the funds for, credit history, and current financial circumstances. The best way to determine which loan is best for your company is to take a look at all of your options or consult with a lending professional regarding your unique circumstances.

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* All loans made by either WebBank, an FDIC-insured Utah industrial bank, or Bank of the Internet Federal Bank, an FDIC-insured federally chartered thrift located in California. In connection with the loans, the Banks' underwriting conditions and terms apply.