Construction contractors don't have to wait 30 to 90 days for receivables to convert. Revenue-based cash advances unlock capital against your invoicing history — in as little as 24 to 72 hours.
The Cost of Waiting on Construction Receivables
Every contractor has turned down a new job because the capital was sitting in unpaid invoices. The opportunity cost is real — but difficult to quantify in the moment.
Consider a contractor with $80,000 in outstanding receivables and a new job requiring $40,000 in materials. Waiting 60 days for the receivables to clear means the new job doesn't start until then.
Two months of labor and profit are lost.
The cost of a cash advance — typically 15% to 25% of the advance amount — is often smaller than the cost of the delayed opportunity. That calculation needs to be made explicitly before deciding to wait.
How Construction Cash Advances Are Priced
Understanding the pricing structure prevents surprises and allows you to compare options accurately.
Factor rates, not interest rates, are used in most revenue financing products. The math is straightforward once you know the formula.
| Advance Amount | Factor Rate | Total Repayment | Cost of Capital |
|---|---|---|---|
| $25,000 | 1.20 | $30,000 | $5,000 |
| $50,000 | 1.25 | $62,500 | $12,500 |
| $100,000 | 1.30 | $130,000 | $30,000 |
When a Construction Cash Advance Makes Sense
Not every cash gap warrants an advance. Discipline in deploying capital financing — and knowing when it is and is not the right tool — determines whether it helps your business or burdens it.
- You have a confirmed new job requiring materials or labor mobilization
- Your outstanding invoices represent reliable, low-dispute receivables
- The opportunity cost of waiting exceeds the cost of the advance
- Your payroll obligations fall before your next invoice payment date
- Equipment maintenance or licensing will lapse without immediate capital
- You have a supplier deposit deadline you cannot defer
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Check Capital Eligibility →Frequently Asked Questions
Revenue-based advances typically provide 80% to 90% of average monthly revenue — not a specific percentage of a single invoice face value. The advance amount is based on revenue history.
If your invoices represent consistent monthly revenue of $50,000, you can generally access $40,000 to $75,000 depending on the lender and your profile.
Revenue financing does not require GC notification. It is not tied to specific invoices.
Invoice factoring does require GC notification because the factor acquires the right to collect directly. Revenue financing operates independently of your client relationships and does not alter your payment terms with your GC.
The cost is expressed as a factor rate — typically 1.15 to 1.45. A $50,000 advance at a 1.25 factor rate means you repay $62,500.
The effective annualized cost depends on how quickly you repay. Faster repayment produces a lower effective annual rate.
Compare the cost against the value of the opportunity the capital enables.
External Resource
SBA.gov Business Loan Programs — U.S. Small Business Administration — Loans
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The Construction Mobilization Capital Gap
Where the cash gap lives — and where RBF deploys.
Timeline represents typical municipal and commercial construction payment cycles. Actual timelines vary by contract structure.
Revenue Financing Estimator
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Illustrative estimate only. Not a lending commitment. Actual terms depend on lender underwriting and business profile. Results vary.
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