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Draw Delay Cost Calculator
Construction loan draw delays cascade: subcontractors carry payables at 8-15% interest, the schedule slips while waiting for funding, and daily overhead burns. This calculator quantifies the total cost of a draw delay so developers and GCs can prioritize lender-relationship investment to keep draws moving.
Cost of carrying sub payables
Total draw delay cost
$17,416
Sub carrying cost
$2,416
Schedule overhead cost
$15,000
How the math works
Draw delays cascade — subs carry payables at 8-15% interest, the schedule slips, and daily overhead (superintendent, equipment, security) burns. A 3-week draw delay on a $350K draw costs ~$2,400 in sub carrying plus another $15K if the schedule slips 10 days.
Lender-side delays usually due to inspection scheduling, lien waiver verification, or budget reallocation requests. Pre-build relationships with lender's construction admin to keep draws moving.
How to Use
- Enter pending draw amount and delay in days.
- Enter subcontractor financing rate (8-15% typical).
- Enter schedule slip days caused and daily overhead burn.
- Read total draw delay cost.
Frequently Asked Questions
Common delay sources?
Lien waiver issues, inspection scheduling, budget reallocation requests, lender's third-party inspector availability. Pre-arrange these workflows with lender at construction loan closing.
Sub carrying cost basis?
Subs typically borrow on credit lines at prime + 2-5% (8-15% range in 2024). Larger subs absorb 1-2 weeks; smaller subs need draws within 7-10 days.
Recovery from lender?
Construction loans rarely have draw-delay penalty clauses for the lender. Best protection is choice of lender — pre-vet construction loan administration responsiveness.
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