Progress payment and drawdown finance

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. Most construction trouble starts in the drawdown schedule rather than in the approval, and it is fixable at the start. That is where we spend the time.

The facility is divided into stages and funds are released as each stage is completed and certified, rather than paid out in full at settlement. Slab, frame, lock up, fixing and practical completion are the usual stages. You pay interest only on what has been drawn, so the cost builds as the project does.

The lender, on the evidence of a quantity surveyor report. The surveyor inspects the site and certifies the value of the work in place and the cost of the work remaining. Once that report is accepted, the release follows. It is an evidence process rather than a judgement call.

It is the quantity surveyor's estimate of what it will cost to finish the building from where it stands. The lender reads it to confirm the remaining facility is enough to complete. If that figure rises, a project on programme can still have a drawdown queried, because the question is whether the money left will finish the job.

Usually not out of pocket. Interest during construction is normally capitalised, meaning it is added to the facility rather than paid monthly, because the project produces no income while it is being built. It is still a real cost and it should sit in your feasibility.

On most facilities, yes. The lender commonly requires your contribution to be spent before it begins releasing, so the cash requirement lands at the start rather than spread across the build. Where the contribution is equity in land you already own, it is generally treated as contributed at settlement.

Retention is a portion of each payment held back under your building contract and released after a defects liability period that runs past practical completion. It gives you something to draw on if defects are not attended to. It also means part of the facility stays committed after the building is occupied.

Most delays trace to one of four things: the quantity surveyor has not yet inspected, the report has raised a cost-to-complete question, the drawdown schedule in the loan does not match the stage the builder has claimed, or documentation for the stage is incomplete. Tell us early and we will work through it with the lender rather than after the builder has stopped.

You fund the difference until the stage certifies, which is exactly why the loan schedule and the building contract should describe the same stages at the same values. It is the most common avoidable cash problem on a build, and lining the two documents up before signing costs nothing.

The point at which the building is finished enough to be used for its purpose, even if minor items remain outstanding. It triggers the final drawdown, the occupation certificate process and generally the start of the defects liability period.

It is repaid, either from the sale of the finished project or by a term facility secured against the completed building. Where the same lender writes both, the roll is usually mechanical. Where a second lender takes over, that facility needs conditional approval before the construction loan matures.

That is what the cost-to-complete report is designed to surface, usually partway through rather than at the end. It is solvable and it is common. Our cost-to-complete and overrun finance page sets out the options, including where the existing lender funds the gap and where a second facility is the practical route.

Sometimes, and it is easier at some lenders than others. It generally requires the lender to agree and a surveyor to support the revised staging. It is far simpler to set the schedule correctly against your building contract before the facility settles.

The fixed price building contract with its payment schedule, the development consent and construction certificate, your feasibility, the title or contract of sale for the site, and details of your builder. If you already have a letter of offer from a lender, send that too and we will read the drawdown terms in it.

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.

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.

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.

Yes. That is our core ethos, helping you understand the right strategy, structure and clear advice from the first conversation. First time borrowers are least prepared for the drawdown sequence, and it is entirely learnable. We will walk you through what each stage requires, when the cash is needed and what the surveyor will be looking at, before you commit to anything.

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.