Industry Authority Center
You start work on Day 1. The draw doesn't arrive until Day 45. Payroll doesn't wait for project schedules. Banks want the project receivable as collateral. That receivable doesn't exist until the work is done. MCA funds against your past deposit history and gets you capital far faster than a bank.
General contractors and subcontractors qualify for MCA with 500+ FICO, 6+ months in business, and $4,000-$6,000+/month in deposits. MCA bridges draw schedule gaps, covers payroll, and funds materials, all without requiring equipment, bonding, or project receivables as collateral. Funding timing is set by the funding provider after review.
Start with the path that matches your situation.
You mobilize on Day 1. Your first draw arrives on Day 45-90. That's the gap MCA bridges.
The draw schedule is one delay. Retainage is a second one, and it usually lasts longer.
Most commercial contracts, and many residential ones, hold back a percentage of every progress payment, typically 5% to 10%, as retainage. That money does not move on the normal draw schedule. It sits with the owner or GC until the project reaches substantial completion, the punch list is closed out, and final sign-off happens, which can run well past the date you submitted your last invoice. A subcontractor who finishes their scope in month four may not see that retainage until the whole project closes in month seven or eight.
This matters for how you think about MCA funding. It is priced and approved against your business bank deposit history, not against a specific invoice or retainage balance, and it bridges the gap between mobilizing on a job and the deposits that actually show up in your account, including the net (after-retainage) amount of each progress draw. It is not a way to collect your retainage early. If retainage itself is what is tied up, the more direct fix is usually contractual: a retainage-reduction clause, an early-release negotiation with the GC or owner, or a project-specific retainage bond, rather than financing.
Unrestricted capital: use it wherever your project or business needs it.
The 4 factors underwriters evaluate on every construction company application.
Construction factor rates: 1.18-1.38 for strong profiles. Lump-sum draw deposits (common in construction) are averaged across 3 months: underwriters expect payment irregularity in this industry.
Same contractor, two completely different underwriting conversations.
A construction business weighing a bank/SBA term loan against a merchant cash advance is really weighing speed and accessibility against lower headline cost. Here is how they compare for a contractor who needs capital before the next draw, not in 6-8 weeks.
At a Glance
Need capital before your next draw or to start a new job now: MCA. Have 2+ years of financials and can wait 6-8 weeks: a term loan is the lower-cost path.
| Feature | Merchant Cash Advance (MCA) | Traditional Term Loan |
|---|---|---|
| Approval basis | Average monthly deposits, 500+ FICO, 6+ months in business | Credit history, financials, collateral (often equipment or real estate), 2+ years in business |
| Time to funding | Provider-set | 2-8 weeks depending on lender |
| Repayment | Daily/weekly holdback as a % of deposits, adjusting with the draw schedule | Fixed monthly payment regardless of draw timing |
| Collateral | None (a UCC-1 is filed against future receivables) | Often required (equipment lien or blanket lien) |
| Best fit | Bridging payroll/materials gaps between draws, newer contractors | Established contractors with strong financials who can plan 2+ months ahead |
MCA advance amounts are based on average monthly deposits from your business bank account, not on project receivables, bonding capacity, or equipment value.
| 3-Mo Avg Monthly Deposits | Min Advance (0.75×) | Typical Advance (1.0×) | Max Advance (1.5×) |
|---|---|---|---|
| $15,000/month | $11,250 | $15,000 | $22,500 |
| $40,000/month | $30,000 | $40,000 | $60,000 |
| $80,000/month | $60,000 | $80,000 | $120,000 |
| $150,000/month | $112,500 | $150,000 | $225,000 |
| $300,000/month | $225,000 | $300,000 | $450,000 |
Higher multipliers (1.0×-1.5×) require 12+ months of operation, consistent deposit history, and fewer than 2 NSFs per month. Construction companies with seasonal revenue gaps and strong peak-season deposits often qualify at 1.0× based on annualized average. → Estimate your daily payment with the MCA Calculator
A construction file moves faster when you already know your own numbers.
MCA is built for a specific, time-boxed timing gap: a signed job that has already started, where the cash you need is already contractually coming, just not yet. It is not the cheapest way to fund long-term growth, and it is not a fix for a business that is not generating enough signed work on its own. The comparison below is meant to help you decide before you apply, not after.
Common questions from GCs, subcontractors, and specialty contractors about qualifying and how MCA works for construction.
Yes. General contractors and subcontractors qualify for MCA with 500+ FICO, 6+ months in business, and $4,000-$6,000+/month in business bank deposits. MCA underwriters evaluate project draw deposits and subcontractor payments from your bank statements, not your bonding capacity, equipment value, or project receivables.
Construction company MCA funding typically ranges from $25,000 to $1,000,000 depending on average monthly deposits. A GC averaging $60,000/month in deposits may qualify for $45,000-$90,000. Larger contractors averaging $200,000+/month may qualify for $150,000-$400,000.
Yes. This is one of the most common uses of construction MCA. Draw schedules on commercial and residential projects often pay 30-90 days after work is completed. MCA bridges the gap. Funding is based on your past deposit history, not your pending draws.
No. Construction MCA does not require heavy equipment, vehicles, tools, bonding capacity, or project receivables as collateral. Repayment comes from a daily percentage of your business bank deposits, typically 10-14%. No equipment liens, no bond assignment.
Yes. Bank declines do not affect MCA eligibility. Banks often decline construction companies because of revenue seasonality and draw schedule irregularity. MCA evaluates your actual bank deposit history, not the bank's construction industry risk model.
Most construction MCA applications receive a decision after submitting 6 consecutive months of bank statements. Funding follows contract signing on the provider’s timeline. Payroll-critical situations can sometimes be prioritized by the funding provider.
Yes. MCA funds are unrestricted. Contractors use MCA for equipment down payments, tool purchases, vehicle repairs, materials advance for a new project, bonding insurance premiums, sub payroll, and operating capital between draws.
Seasonality affects factor rates but rarely disqualifies a construction company. MCA underwriters expect construction revenue to vary by season. They average your 6-month deposit history. A strong summer and fall followed by a slow winter and spring is a normal construction revenue pattern. Larger contractors with 2+ years of consistent annual deposits typically qualify at 1.0×-1.25× average monthly deposits even with seasonal gaps. The key metric is total annual deposits divided by 12, not any single month.
When you accept an MCA, the provider files a UCC-1 financing statement against your business assets to document their interest in your future receivables. This is a public filing and may appear in bond underwriting searches. Most surety companies do not treat a UCC-1 lien on receivables as a disqualifying factor for bonding capacity. It is different from a lien on specific equipment or a property. However, if you plan to seek bonding within 60-90 days of taking an MCA, disclose the UCC-1 to your bond agent proactively to avoid surprises.
One-page application. 6 consecutive months of bank statements. Review begins as soon as your file is complete.
500 FICO OK · No equipment collateral · Draw schedule gaps covered
Or call/text: 330-238-3003
T.A.G. Business Funding
500 FICO minimum. Bank declines OK. Revenue matters more than credit score. Revenue matters more than credit score.
500 FICO minimum · $4K-$6K+/month revenue · Funding timing is set by the funding provider after review
Have more questions? See our complete MCA FAQ →
