Construction and contracting industries have always operated on delayed payment cycles. General contractors usually wait 30 to 90 days for their payments from private clients before paying subcontractors. Add commercial real estate or municipal contracts to the mix, and you can end up waiting months for a paycheck.
Meanwhile, your business doesn’t stop. You’ve got to pay crews, purchase materials, and take on new projects to keep revenue flowing. If these payment cycles slow your growth and stress your finances, you’re not alone.
The good news is that the best business loan providers for contractors offer fast, reliable financing solutions to help you bridge that gap and keep your business moving. When you know the right situation, product, and lender for quick funding, delayed invoices won’t hold you back.
When to Use Quick Business Loans vs. Planning Ahead
If you can’t cover operational expenses, you can’t purchase materials. You could lose workers, delay or miss new opportunities, and your financial and professional reputation may suffer.
Think of quick business loans like scaffolding on a building. You need something to keep the walls up while completing the job, but the frame isn’t a permanent part of the structure. Quick financing can cover urgent cash flow gaps and keep your business running.
Whenever possible, prepare for funding ahead of time. You’ll secure better terms and avoid scrambling at the last minute. For instance, apply for a pre-approved line of credit before your predictable slow season or arrange a term loan before taking on a significant municipal contract. Planning your financing before you’re in a pinch keeps your business stable.
Fast Financing Options Built for Contractors
Today’s financing landscape allows you to access funds in days or hours through streamlined online applications. Here are a few fast-turnaround solutions tailored to contractors waiting on slow payments.
1. Working Capital Loans
A working capital loan is a quick business loan for small businesses facing unplanned expenses. It’s similar to a traditional term loan, but lenders design these products to be accessible, fast, and flexible.
Lenders don’t require years of business history or a perfect credit score to qualify for a working capital loan. And you don’t have to gather hundreds of documents. Working capital applications can be online and take only a few minutes to fill out. It’s accessible to busy contractors.
The timeline for working capital loans is fast. Most lenders will notify you about approval in less than 24 hours and transfer funds in one to two days. Some leading companies can even offer funding the same day to qualified borrowers. Working capital loans also have fast repayment schedules. Most terms are 18 months or shorter.
Working capital loans typically have fixed monthly payments. However, the best lenders offer other options, such as fixed daily or weekly amounts or a revenue-based payment. They try to match your business cycle.
2. Invoice Financing
Invoice factoring allows you to use your outstanding invoices to a financing company for an advance on their value. Some lenders will offer as much as 100% of the invoice up front. Once your client pays the invoice, the lender keeps the borrowed amount and fees before sending the rest to you.
Lenders use your customers’ payment history when approving your application. Consider invoice factoring if you work with reliable clients who take a long time to pay. Then you can secure working capital immediately rather than hounding customers or delaying your projects.
3. Business Lines of Credit
A revolving line of credit allows you to draw funds as needed and repay only what you use. It’s similar to a credit card. Consider applying for a business line of credit if your payment cycle is unpredictable. It can bridge cash flow gaps so you can cover operating expenses, emergency repairs, or take on new contracts.
Most lenders require solid business history and a decent credit score before extending a credit line. If you are on the edge of the requirements or want better terms, you can use assets like heavy machinery and vehicles to secure your line of credit. Look to fintech and industry-specific funding companies for options customized to contracting businesses.
4. Merchant Cash Advances (MCAs)
When it’s critical that you secure funds today, consider an MCA. Many merchant cash advance lenders transfer capital within 24 to 48 hours. An MCA gives you upfront cash based on your future revenue. It’s more like invoice factoring than a traditional loan. You often repay it through a percentage of your incoming payments, but some lenders offer fixed repayment as well.
Look for cash advances with revenue-based repayment rather than relying on credit card sales to avoid straining your business. An MCA can unlock fast and flexible capital if you receive regular payments from contracts or clients and find a product designed for contractors.
What to Look for in a Quick Financing Partner
It’s easy to accept the first offer when you’re in a crunch. But you’ll save yourself money and frustration by choosing the right financing partner. Look for lenders who:
- Respond to applications within 24 hours or faster
- Fund business within two business days
- Clearly state the rates and fees
- Answer questions about loan terms
- Frequently work with other contractors
- Offer repayment plans to match your cash flow
- Provide ongoing customer support
Top lenders for contractors build ongoing funding relationships. The longer you work with them, the easier it is to access capital, renew loans, or increase your credit limit. It’s worth spending extra time looking for a financing partner now to have a solid connection to rely on when you have urgent needs.
Quick Business Loans For Moving Forward
You’ve done the work. You’ve delivered quality. You’ve upheld your end of the contract. It’s unfair and frustrating that a slow-paying client can hold you back. With fast financing options built for contractors, you can break out of the delayed payment cycle.
So don’t wait for a check that might be weeks away. Explore your financing options, compare your choices, and choose a partner that helps you move forward.