How do you like your construction loan funds released—big chunks or lots of little payments?

Four or five draws really does hit that balance, in my experience. Too many small payments and you’re buried in receipts and spreadsheets, but handing over a big chunk early can be risky—seen subs vanish after payday more than once. I’ve found tying each draw to clear milestones (framing, rough-in, drywall, etc.) keeps everyone honest and the project moving. It’s not perfect, but it beats chasing down missing contractors or sorting through a mountain of invoices.

Too many small payments and you’re buried in receipts and spreadsheets, but handing over a big chunk early can be risky—seen subs vanish after payday more than once.

Couldn’t agree more with the milestone approach. I’ve done it both ways, and those “little payments” add up to a paperwork nightmare. One time, I tried to streamline things by doing just three big draws... ended up with a half-finished pool house and a missing tile guy. Now I always tie draws to visible progress—framing complete, roof on, etc.—and insist on photos for each stage. Keeps everyone accountable, and you can actually see where your money’s going.

Milestone draws really do seem to hit that sweet spot. I’ve seen too many projects get bogged down in admin when folks try to micromanage every little payment—just not worth the headache. That said, I get the temptation to do fewer, bigger draws for “simplicity,” but like you said, it can backfire fast.

ended up with a half-finished pool house and a missing tile guy

That’s rough. I’ve had similar issues—once had a contractor disappear after the second big draw, and chasing him down was a full-time job. Now I always recommend tying payments to actual, visible progress. Photos are great, but sometimes I’ll even swing by myself or have someone else check things out in person if it’s a big ticket item.

It’s not about being distrustful, just practical. The paperwork is still there, but at least it’s tied to real milestones, not just arbitrary dates or promises. Keeps everyone honest and the project moving forward.

Title: How do you like your construction loan funds released—big chunks or lots of little payments?

Couldn’t agree more about milestone draws being the way to go. I’ve seen both ends of the spectrum—folks who want to release a chunk upfront and hope for the best, and others who want to nickel-and-dime every step. Neither extreme works well in practice. Big upfront payments are just asking for trouble, especially if you’re dealing with subs you haven’t worked with before. People get busy, disappear, or just plain lose motivation once they’ve got most of their money.

On the other hand, splitting it into too many tiny payments is a paperwork nightmare. You end up spending more time tracking receipts and chasing signatures than actually building anything. Plus, it can sour relationships with good trades if they feel like they’re constantly jumping through hoops for every dollar.

Milestone-based draws keep everyone honest without bogging things down. I always tie them to real, tangible progress—framing done, roof on, rough-ins complete, that sort of thing. Photos are helpful, but nothing beats walking the site yourself or sending someone you trust. Had a client once who tried to approve draws based on emailed photos alone... let’s just say the “finished drywall” was only finished on the side facing the camera.

It’s not about mistrust, just common sense. If someone balks at tying payments to actual work completed, that’s usually a red flag for me. At the end of the day, it’s about keeping the project moving and making sure everyone gets what they’re owed—no more, no less. There’s always going to be some paperwork, but at least this way it feels like it’s serving a purpose instead of just creating busywork.

Couldn’t agree more with milestone draws being the sweet spot. You nailed it with this:

Milestone-based draws keep everyone honest without bogging things down.