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General contractor payments, on the draw and the lien waiver
A general contractor is a bank that also builds. Money arrives in draws from an owner or a lender and leaves to subcontractors on a different schedule, and the gap between them is the whole risk of the business.
The draw, the waiver and the holdback
Three instruments that govern every payment on a construction job, and what each demands from the system.
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Progress billing runs against a schedule of values
Each application for payment bills percentage completion against agreed line items rather than a lump description, which is what a lender inspector is actually checking against.
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A lien waiver is exchanged for the money
Conditional and unconditional waivers are collected from subcontractors as payments are released, and a draw that goes out without one leaves an exposure on the property. DRAFT — pending counsel
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Retainage is held until the punch list is closed
A percentage withheld from every draw is tracked as an expected receivable against a release condition rather than treated as a permanent shortfall.
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A change order is authorized before it is built
Extra work is priced and authorized as its own record, because unauthorized work is the most common thing a general contractor never gets paid for.
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Subcontractor payments must not outrun the draw
Payables are sequenced against received draws so the contractor is not financing an owner delay out of its own operating account.
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Lender inspections gate the release
On financed projects the inspection is what releases money, so the billing package and the site condition need to describe the same job on the same day.
What to ask before changing construction billing
Questions from somebody who has waited three weeks on a lender inspection.
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Ask how the payment application maps to your schedule of values
If the system bills lump sums, every draw becomes a negotiation with an inspector who wants line items.
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Ask where lien waivers are stored relative to payments
A waiver that is not attached to the payment it released is a waiver you will be searching for during a title dispute. DRAFT — pending counsel
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Ask how retainage is reported before it is due
Retainage that only appears at the end is retainage nobody chased, and on a long job that is a real number.
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Ask how change orders are prevented from being built first
The control that matters is refusing to schedule unauthorized work, and the system should make that the easy path.
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Ask how subcontractor payables are sequenced against draws
Paying subs ahead of a delayed owner draw is how a profitable job becomes a cash crisis.
Questions general contractors ask
Answers about draws, waivers and holdbacks. Statements about lien rights are marked draft.
Can we bill progress against a schedule of values?
Yes. Each application bills completion against agreed line items, which is what a lender inspector checks rather than a lump description.
Are lien waivers tracked with the payments?
Yes. Conditional and unconditional waivers are collected as payments are released and stored with the payment that released them. (DRAFT — pending counsel)
How is retainage handled?
As a tracked receivable against a release condition, visible throughout the job rather than discovered at closeout.
How are change orders handled?
Priced and authorized as their own record before the work is scheduled, because unauthorized work is the most common unpaid work.
Can subcontractor payments be sequenced against received draws?
Yes, so an owner or lender delay does not get financed out of your operating account.
Two tools to run before the next draw
Both are open access and neither needs your job costing.
Check what fits your business
The questionnaire asks a builder the boarding questions — draw schedules, subcontractor payouts, and change orders that move the contract value after it was agreed. Money taken against work not yet done is the underwriting subject, and it is better understood before boarding than during it.
Statement audit
The statement audit reads a statement you already have and separates the deposits and draws from the final payments. Contractors billing per job rather than per month usually find the schedule, not the rate, is what shaped the bill.
Talk to somebody who has run a draw schedule
Tell us about the firm and how to reach you.
Thank you. We will book a short call and bring the draw and retainage questions to it.
We will implement whatever is right for you — including keeping what you have.
Last updated: 2026-08-17