Draw Request Lag Calculator

Draw lag turns into real carry cost on construction projects.

Monthly draw amount

Submission-to-funding lag days

Cost of capital %

Number of draws

Cumulative lag cost

$236,712

Cost per draw

$13,151

Total draw volume

$36,000,000

How the math works

Per draw = draw × COC × (lag/365). Cumulative = per draw × count.

$2M × 10% × (24/365) = $13,151 per draw × 18 draws = $236,712 cumulative lag cost.

How to Use

Enter monthly draw amount.
Enter submission-to-funding lag days.
Enter cost of capital %.
Enter number of draws.
Read cumulative lag cost.

Frequently Asked Questions

What's a typical draw lag?

Community bank construction loans: 15-25 days. Regional bank: 20-30 days. Money-center bank: 25-45 days. Debt fund / private credit: 7-15 days. HUD or FHA 221(d)(4): 45-90 days (bureaucratic process). CMBS construction: rare, but when offered, 14-21 days. Lag grows with: amount, first-draw complexity, change-order disputes, lien-waiver completeness. Strong GCs and sponsors reduce lag by 30-50% just on paperwork discipline.

What slows draws?

Missing lien waivers (biggest cause). Bank inspector visit scheduling (independent construction consultant, 3-10 business day lead time). Change orders pending owner approval (blocks draw if affecting line item). Cost-to-complete analysis. Re-balancing request (if budget over). Insurance cert renewals. Bond continuation. Inspector photo documentation review. Most institutional lenders have checklist PDFs — use them.

Cost of the lag?

Lag cost = monthly draw × (lag days / 365) × cost of capital. On a $2M draw with 21-day lag at 9%: $2M × (21/365) × 9% = $10,356 per draw. Across 24 monthly draws over 2-year project: $248k cumulative. Plus hidden GC pressure (subs unpaid, threats to walk, crew momentum lost). Institutional lenders with <15 day turn are worth 25-50 bps spread premium on rate.

How do you reduce draw lag?

(1) Standardize pay app format with lender input at loan closing — no last-minute rework. (2) Collect lien waivers conditional on payment before GC pays subs. (3) Schedule inspector visit at fixed dates (e.g., 25th of month) for predictability. (4) Sub-allocate draw into multiple smaller ones that process in parallel. (5) Dedicated draw coordinator on sponsor team. Best GCs have internal SLAs — submit by day 1, first feedback by day 5, funding by day 15-21.