Construction Finance
Unlock cash tied up in uncertified applications for payment or staged invoices
Ready to go?
Apply in 3 minutes. One of our Business Finance Specialists will then guide you through your options.
Construction FInance
Unlock cash tied up in uncertified applications for payment or staged invoices
Ready to go?
Apply in 3 minutes. One of our Business Finance Specialists will then guide you through your options.
Funding Amount
£5k-£10m
Advance rate
Up to 70% of invoice
Time to Arrange
As Little as 7 Days
A credit line to allow your business to grow
Construction Finance helps construction sector contractors and subcontractors by unlocking cash tied up in outstanding staged invoices or uncertified payment applications. This flexible credit line gives you the working capital required to take on new clients, fund new contracts or pay suppliers quicker.
What is Construction Finance?
Construction Finance helps construction sector contractors and subcontractors by unlocking cash tied up in outstanding staged invoices or uncertified payment applications – speeding up cash flow. This specialist type of finance is built to work with contracts, framework agreements or purchase orders that are a standard feature of the construction sector.
A line of credit is put in place in proportion to the sales ledger and work in progress allowing you to access up to 70% of the value of the invoices due to you. You can draw down from this credit line when an Application for Payment is submitted, or when the payment has been approved. This means you can have certainty over what funds you have available as you deliver your contract.
How does Construction Finance work?
- Carry out your works and raise an Application for Payment/invoice
- Upload the details onto the lender’s system
- Access up to 70% of the value of the Application for Payment
- When your client pays the balance of the invoice is paid back to you – less fees payable to the lender
Your Construction Finance facility is waiting.
Talk to one of our Business Finance Specialists. We’re on hand to take you through the options available.
Am I eligible for Construction Finance?
You’re likely to be eligible for Construction Finance if:
- You're a contractor or sub-contractor working in the UK construction industry
- You raise an Application for Payment for part or completed works
- You work under a contract, framework agreement or Purchase Order
- You want to improve your cash flow during a contract
What are the benefits of Construction Finance?
- Cash is received quicker. Rather than waiting 30/60/90 days for your invoice to get paid the majority of the value of the invoice is cashed in up front helping cash flow.
- A business’s debtor book (outstanding invoices) is often their biggest asset. Invoice finance leverages that asset, normally meaning security over property is not required.
- Cash can be put to work back in the business – funding growth, funding new contracts, improving negotiating power with creditors and so on.
- Construction finance can be more flexible than loan or overdraft finance – which is great for growing businesses. The credit limit grows proportionally to the debtor book, unlike loans and overdrafts which are normally limited by the value of tangible security available (property).
- Under Invoice Factoring the lender chases and collects payments on your behalf meaning you don’t need to undertake that credit-control function.
- Borrowing against your outstanding invoices can raise more cash than loan finance. Funding is agreed as a percentage of your sales ledger, unlike loan finance which is agreed in proportion to your profitability.
How quickly can I get Construction Finance set up?
Getting set up for construction finance varies in process from lender to lender. Some specialist lenders can get a facility done and dusted in a week or two, but it typically depends on how quickly you can supply the required information.
A typical process is submission of an application (including financial accounts, contracts, an aged debtor and aged creditor list and other general business details) followed by an indication of terms after a day or two. Once terms have been agreed a “survey” or “audit” will be instructed. This is a deep dive into your credit control processes, records and history. This can take a week or so, followed by a full credit underwriting process.
