Cost to complete and construction overrun finance
Funding the gap when a build costs more than the facility allows
Part way through a build and short of funds?
A cost to complete that has outgrown the remaining facility is one of the more common positions in construction, and there is established funding for it. Most of these are resolved, and the projects that resolve fastest are the ones where the shortfall is raised early rather than at the last stage. We arrange cost to complete funding from $50K to $30M and we will tell you where your options sit.
We can help you:
- Fund a shortfall between the remaining facility and the cost to complete
- Approach your existing lender to extend or increase the current facility
- Arrange a second facility behind your existing senior lender
- Refinance the whole construction facility to a lender with more appetite
- Fund variations, ground condition costs and works outside the building contract
- Fund holding costs where a delay has pushed the project past its expected end
- Arrange funding where a builder has left the site and the job needs completing
- Extend a facility approaching maturity before the building is finished
- Work through the quantity surveyor position with the lender on your behalf
- Arrange finance from $50K to $30M nationally, from our Sydney office
Who we help:
- Established business owners who require finance between $50K to $30M
- First-time borrowers who need a beginner-friendly strategy
- Sophisticated borrowers and investors who need a unique strategy and deal structure
- Urgent, time-sensitive deals that need to move quickly
- Self-employed and trust-structured borrowers who need their income presented properly
- Commercial property owners with multi-tenancy plans
Speak to a specialist today
1,000+
loans settled
$2B+
funded
Cost to complete finance
Funding the gap so a part built project gets finished
A part built project is worth considerably less than a finished one, which is why lenders across the market would rather see a build completed than stalled. That shared interest is why these positions are solvable. What we do is find the route with the fewest moving parts and get it agreed while the site is still moving.
Funding from $50K to $30M
from over 60 bank & non-bank lenders
- ANZ
- Bankwest
- Bluestone
- Bank of Queensland
- Commonwealth Bank
- Firstmac
- ING
- Macquarie
- NAB
- Pepper Money
- Suncorp Bank
- Thinktank
Cost to complete and overrun finance specialists
Cost to complete funding is a specialist area, and one where speed changes the options available. We can assist developers and owners part way through a build. The positions we can assist with include:
- A cost to complete report that has come in above the remaining facility
- Variations and ground conditions that were not in the original contract
- A facility approaching maturity with the building not yet finished
- Holding costs accumulating through a delay outside your control
- A builder who has left site with the project part complete
A part built project is worth much less than a finished one, so every lender involved has the same interest in seeing it completed. That shared interest is why a shortfall is solvable, and raising it early gives you more routes than raising it late.
Why businesses choose Ardent Capital Group as their broker
Execution and strategy
Strategy first, then execution. We structure your deal properly and take it to the lenders genuinely comfortable with it, so you are not chasing each one yourself.
Clear advice for smart lending
Straight answers on LVR, structure and timing, including when a deal does not stack up.
A long-term partner
We stay with you well beyond settlement, with lasting relationships and ongoing support from the team.
Construction types
Cost overrun scenarios we can help finance
There are usually three routes out of a shortfall and they are not equally available to every project. Which one fits yours depends on how much of the build is done, how your senior lender is positioned, and how much time is left on the facility.
What a shortfall looks like on a facility
It usually appears in a quantity surveyor report partway through the build. The surveyor certifies the work in place and the cost to complete, and the second figure comes in above what is left in the facility. The project may be perfectly on programme; the question the lender is asking is whether the remaining money finishes the job.
From there the lender will generally want to see how the gap is covered before it releases the next drawdown. That is the point at which options are widest, because the site is still moving and the building is still progressing. It narrows once work stops.
- Surfaced by the cost to complete figure in a surveyor report
- Can occur on a project that is entirely on programme
- The lender asks how the gap is covered before the next release
- Options are widest while the site is still moving
- A common position rather than an unusual one
- Raised early gives more routes than raised at the final stage
Going back to your existing lender
The simplest route is usually an increase or an extension from the lender already in place. They hold the security, they know the project, and no second party has to be introduced, so where it is available it is faster and cheaper than any alternative.
Whether it is available depends on where the increased facility sits against the completed value and the revised total cost, and on that lender's own policy. Some will fund a variation without difficulty; others have no appetite to increase mid-build regardless of the numbers. We will put the position to them properly, and if the answer is no we move to the next route without losing time.
- The fastest and usually the cheapest route where it is available
- The existing lender holds the security and knows the project
- Assessed against completed value and the revised total cost
- Appetite to increase mid-build varies considerably by lender
- The position put properly rather than as an informal request
- If the answer is no, the next route starts immediately
A second facility behind your senior lender
Where the existing lender will not increase but is comfortable for the project to continue, a second facility can sit behind it and fund the gap. The senior lender keeps its first position and the second lender takes what is left, pricing for the additional risk it carries.
The gate on this route is intercreditor consent. The senior lender has to agree to the second registration, and its willingness to do so is the deciding factor rather than the second lender's appetite.
- Senior lender retains first position, second facility funds the gap
- Priced for the additional risk the second lender carries
- Intercreditor consent from the senior lender is the gate
- The senior lender's willingness usually decides the route
- Suits projects where the existing lender is happy to continue
- Established structure rather than a last resort
Refinancing the whole facility
Where the existing lender will neither increase nor consent to a second registration, the remaining route is to refinance the entire construction facility to a lender with more appetite. The new facility repays the incumbent and funds the balance of the works under one position.
This takes longer and costs more than the other two, because it involves a fresh valuation, fresh legals and a new set of establishment costs on a project already spending. It is the route that most often resolves a stalled position, and the earlier it starts the better it works, because a new lender is assessing a live site rather than an idle one.
- New facility repays the incumbent and funds the works to completion
- Requires a fresh valuation, legals and establishment costs
- Slower and more expensive than an increase or a second facility
- Often the route that resolves a genuinely stuck position
- Works better started early, while the site is still active
- One lender and one position from that point forward
When the builder does not finish
A builder leaving site part way through is the hardest version of this and it is not rare. The immediate finance question is the cost to complete under a replacement builder, which is usually higher than the balance of the original contract, because a new builder prices the unknowns in work they did not start.
What lenders want to see is a revised cost to complete from a quantity surveyor, a replacement builder identified, and a clear picture of where the contract and any retention or insurance sit. Those are matters for your lawyer and your surveyor. Our part is arranging the funding against that revised position, so start both at the same time.
- Replacement cost to complete usually exceeds the original contract balance
- A new builder prices the unknowns in work they did not begin
- Lenders want a revised surveyor report and a replacement builder identified
- Contract, retention and insurance positions established with your lawyer
- Funding arranged against the revised cost to complete
- Legal and finance tracks started at the same time, not in sequence
What moves a construction budget
Ground conditions are the most frequent cause, because what is under a site is the one thing nobody prices with certainty until they dig. After that come client variations, material and trade cost movement across a long programme, and the civil works that sit outside the building contract and are easy to under-allow.
Delay is the quiet one. A programme that runs months over adds interest, rates, insurance and rent on premises you have not left, none of which appear in a building contract. Where a facility is nearing maturity as well, that combination is worth addressing before both land together.
- Ground conditions are the most frequent single cause
- Client variations added after the contract was priced
- Material and trade cost movement across a long programme
- Civil and external works commonly under-allowed
- Delay adds interest, rates, insurance and holding costs
- A maturing facility alongside a delay is worth addressing early
Our complete list of services
- Cost-to-complete and overrun finance
- Progress payment and drawdown finance
- Owner occupier construction finance
- Warehouse and factory construction finance
- Commercial fitout and refurbishment finance
- Development exit finance
- Property development loans
- Residual stock finance
- Urgent and bridging finance
- Commercial property loans
- Commercial refinancing
- Working capital and business overdrafts
- Business loans
- Land acquisition finance
- SMSF commercial property finance
Our process
How it works
✓We understand your scenario
We talk through the property, your business and timeline, and any complexity in your structure.
✓We find the right lender
We match your deal to the lender on our panel best suited to it.
✓You receive clear terms and guidance
We present indicative terms and explain what we recommend, and why.
✓We stay with you beyond settlement
We manage everything through to settlement, then stay in your corner well beyond it, with ongoing support from the team.
Lender features compared
How cost to complete funding compares across lenders
| Cost to complete feature | Major banks | Non-bank lenders | Availability |
|---|---|---|---|
| Increase to an existing facility | Rarely available mid-build | Case by case | Critical |
| Second position behind a senior lender | Rarely available | Available | Critical |
| Refinance of a part built project | Limited appetite | Active | Critical |
| Funding after a builder has left site | Rarely considered | Considered case by case | Critical |
| Holding costs and capitalised interest funded | Case by case | Commonly available | Important |
| Intercreditor consent required | Yes | Yes | Critical |
| Speed of assessment | Generally slower | Days to a few weeks | Critical |
| Term | Balance of the build | Balance of the build plus a margin | Standard |
| Approval timeframe* | 4 to 8 weeks | 3 days to 3 weeks | Varies |
| Best suited for | An increase from the lender already in place | Second positions, refinances and part built projects | — |
*IMPORTANT: These are indicative figures only. Terms, LVRs and approval timeframes vary with borrower capacity, security type and individual lender criteria, and are subject to change. Figures are a general guide, not a quote or an offer of finance, and not a representation that finance is available on these terms.
Frequently asked questions
Why do borrowers prefer Ardent Capital Group as their lending specialist?
Ardent Capital Group brings the same method to every client: execution and strategy, clear advice for smart lending, and long-term growth. That means the right lender, structure and timing, straight advice so you borrow with confidence, and today's deal built toward where you want to be tomorrow. On a part built project the routes narrow as time passes, so we establish which are open to you now. We establish that first and move on it.
My build is going to cost more than my loan covers. What are my options?
There are usually three. An increase or extension from your existing lender, which is the fastest where it is available. A second facility sitting behind that lender, which needs its consent. Or a refinance of the whole facility to a lender with more appetite. Which fits depends on how far through the build you are and how your current lender is positioned.
How much can I borrow to cover a shortfall?
We arrange from $50,000 to $30 million. What is available on a part built project depends on the value of the completed building, the revised total cost and what your existing lender already holds. The combined position across both lenders is what the second lender assesses.
Will my existing lender just increase the loan?
Sometimes, and it is always worth asking properly first. It depends on where the increased facility sits against completed value and revised cost, and on that lender's own appetite to increase mid-build, which varies widely. Some do it without difficulty. Others have no appetite regardless of the numbers, which is not a reflection on your project.
What is intercreditor consent and why does it matter?
It is your senior lender agreeing to a second lender registering behind it. Without that consent a second facility cannot proceed, no matter how comfortable the second lender is. It is the gate on this route, and it is why the senior lender's position is the first thing we establish.
How quickly can this be arranged?
Through the specialist panel, commonly days to a few weeks, and speed is genuinely part of the value here because options narrow once work stops. A major bank increase runs to the usual four to eight weeks. Tell us your next drawdown date and your facility expiry at the start.
My builder has walked off site. Can you still help?
Yes, so start straight away. The finance question is the cost to complete under a replacement builder, which is usually higher than the balance of the original contract. Lenders want a revised surveyor report and a replacement builder identified. The contract, retention and insurance questions are for your lawyer, and both tracks should run at the same time.
My facility expires before the building will be finished. What happens?
That is a common position and it is fundable. Depending on how close to completion you are, the answer is either an extension, a cost to complete facility, or where the building is substantially finished, development exit finance that repays the construction lender and holds the position while the project finishes and sells.
Can holding costs and interest be funded as well?
Commonly yes. A delay adds interest, rates, insurance and in many cases rent on premises you have not been able to leave, and none of that sits in a building contract. Those costs can usually be included rather than found from working capital, and they should be in the number from the start.
Why did the cost to complete rise when the project is on programme?
Because the two measure different things. Programme is about time and cost to complete is about money, so a build can be exactly on schedule while the remaining works have become more expensive to deliver. That is why a drawdown can be queried on a project with nothing wrong with its timeline.
Is a shortfall mid-build unusual?
No. Ground conditions, variations and cost movement across a long programme affect a great many projects, and the funding market has established products for exactly this. What varies is how early it is identified, and that changes the options available.
How do progress payments work in the first place?
Funds are released in stages as work is completed and certified by a quantity surveyor, rather than paid out at settlement. Our progress payment and drawdown finance page sets out the mechanics, including what the cost to complete report is testing at each release.
What will it cost compared with my current loan?
A second facility or a specialist refinance prices for the additional risk being taken on a part built asset, so it costs more than the original construction facility. What we can do is set the routes side by side with their real costs, including establishment and legal costs on a refinance, so the comparison is a proper one rather than a headline.
What documents do you need to get started?
Your current letter of offer and facility agreement, the most recent quantity surveyor report, the building contract and any variations, your revised feasibility, and details of where the project stands on site. Your facility expiry date and next drawdown date are the two things to tell us first.
Do you charge fees for your construction finance service?
Most of the time, no. Where a project requires significant preparation due to its complexity, a small mandate fee may apply, and we will always be upfront about this before any work begins.
What areas do you service?
Although we are based in Sydney, we service clients across all major Australian cities, including Melbourne, Perth, Brisbane, the Gold Coast, Adelaide, Canberra and Hobart, along with their surrounding regional areas. Wherever your project is located, we can arrange your finance.
What other finance can you assist with?
Although our main speciality is property loans for business owners, we also assist with asset finance and working capital. On asset finance, that covers the plant and vehicles a building business runs, from excavators and scaffolding to site utilities and work vehicles. On working capital, we arrange business overdrafts, lines of credit and cash-flow funding to carry a project between drawdowns and to cover holding costs.
This is our first development and we are already over budget. Can you still help?
Yes, and we will say plainly that a first project running over is a well travelled position rather than a sign the project is wrong. Ground conditions and variations do this to experienced developers too. We will look at where you are, tell you which of the three routes are genuinely open, and get moving on the one that fits, so the building gets finished.
Can you give financial advice?
No. Arranging finance and advising on financial products are two different disciplines, and we do the first. What we bring is the credit analysis lenders require, the structuring of the facility, and the strategy for putting your application in front of lenders whose appetite matches it.
Because we act as a credit representative under an Australian Credit Licence, we do not give financial product, superannuation, taxation or legal advice, and nothing we provide should be taken as such. Where your circumstances need that input, we are happy to work with your accountant, financial adviser and solicitor to understand the full picture before anything is submitted.
The information on this page is general in nature and does not take account of your objectives, financial situation or needs.
