BIG CHUNKS OR LOTS OF LITTLE PAYMENTS?
Too many small payments just bog things down with paperwork and waiting for approvals. Had a project where we lost momentum because subs wouldn’t show until the next tiny check cleared... not worth it.
- I’ve run into the same headache with little payments—feels like you’re always chasing signatures and bank approvals, and it kills any rhythm on site.
- Big draws tied to milestones (foundation, framing, rough-in, etc.) make a lot more sense to me. That way, you can actually see progress before shelling out more cash.
- On my last build, I set up clear payment points in the contract. Each sub knew exactly when they’d get paid and what needed to be finished. No confusion, less drama.
- The only time I’d go for smaller payments is with new trades I haven’t worked with before—just as a trust thing. Otherwise, bigger checks, less often, keeps things moving.
- One thing I learned: always double-check your draw schedule with your lender. Some banks are super rigid about how much they’ll release and when. Had one inspector who’d nitpick every detail before signing off—added weeks to my timeline.
- If you do go with bigger payments, just watch your cash flow. Don’t want to end up short if something unexpected pops up (and it always does...).
Honestly, I’d rather deal with a couple of big milestones than a dozen tiny ones. Less paperwork, more building. Just gotta have those contracts locked in tight.
HOW DO YOU LIKE YOUR CONSTRUCTION LOAN FUNDS RELEASED—BIG CHUNKS OR LOTS OF LITTLE PAYMENTS?
You really nailed the main pain points with those small, frequent payments. I’ve seen friends try to manage projects that way and it’s almost like you spend more time chasing paperwork than actually building anything. The constant back-and-forth with banks and subs just eats up all your momentum. It’s honestly impressive you managed to keep things moving at all.
Having payment milestones tied to real progress—foundation poured, framing done, mechanicals roughed in—just seems so much more logical. Everyone on site knows what needs to be finished and when the next check is coming. That clarity does wonders for morale and trust. I’m a big fan of contracts that spell out those points in black and white, too. There’s enough ambiguity in construction already without adding payment confusion to the mix.
I do get the idea of using smaller payments as a bit of insurance when you’re working with new trades or suppliers you haven’t vetted yet. It’s a cautious approach, and sometimes it’s the only way to protect yourself if you sense things might go sideways. But once there’s trust built up, bigger draws really do keep things humming along.
Your point about lenders is spot-on, too. Some banks are so rigid about inspections and paperwork that even the best-laid schedules get thrown off by a nitpicky inspector or a slow approval process. I had one project where we lost three weeks waiting for an inspector to sign off on insulation—just because they were backed up after a storm.
Cash flow can be tricky, though. If you’re not careful, one surprise expense can throw everything out of whack right before a big draw is due. I’ve learned to pad my contingency fund just in case... because something always comes up.
All in all, your approach makes a ton of sense. Fewer payments, tied to visible progress, with clear expectations for everyone involved—that’s how you keep a high-end build on track without drowning in paperwork or drama.
HOW DO YOU LIKE YOUR CONSTRUCTION LOAN FUNDS RELEASED—BIG CHUNKS OR LOTS OF LITTLE PAYMENTS?
I hear you about the paperwork grind. Last time I did a remodel, the bank wanted proof for every tiny thing—felt like I spent more time scanning receipts than picking tile. The milestone method sounds cleaner, but what do you do if a sub flakes halfway through a big phase? Ever had to scramble to cover work that didn’t get finished before the next draw? That’s my biggest worry with bigger payments...
BIG CHUNKS OR LOTS OF LITTLE PAYMENTS?
Honestly, I lean toward the milestone method—less paperwork, fewer headaches. But yeah, if a sub bails mid-phase, it gets messy fast. Had one guy disappear right before inspections... had to dip into my own pocket just to keep things moving until the next draw. It’s a gamble either way, but at least with milestones you’re not chasing receipts for every box of nails. Still, wish banks would chill out a bit on the proof sometimes.
HOW DO YOU LIKE YOUR CONSTRUCTION LOAN FUNDS RELEASED—BIG CHUNKS OR LOTS OF LITTLE PAYMENTS?
I’m with you on milestones being way less of a headache. Chasing down every little receipt just eats up so much time, and honestly, I’d rather be on site than buried in paperwork. That said, I’ve had banks get super picky with proof too—like, do you really need a photo of every single delivery? Gets old fast.
Had a project last year where the drywall crew bailed halfway through and the milestone payment was already out. Ended up scrambling to cover the gap until the next phase. Not fun, but at least I wasn’t nickel-and-diming everything along the way.
I guess it’s a trade-off... bigger chunks mean more risk if someone flakes, but the admin side is just so much smoother. If banks would loosen up a bit on the documentation, milestones would be perfect. Until then, it’s just about finding that balance and hoping your subs don’t ghost you mid-job.
