Revenue-based financing is often a strong fit for construction and contractor businesses because approval leans on your bank-deposit history and monthly revenue rather than your credit score alone — which matches an industry where cash arrives in uneven draws, retainage, and net-30 (or net-60) invoices. Instead of a fixed monthly loan payment, repayment is typically pulled as a small, regular share of your revenue via daily or weekly ACH, so it flexes with the pace of your work. Through a revenue-based/MCA marketplace, contractors with 4-6+ months of deposit history, roughly $10,000+ in monthly revenue, and a FICO around 500+ can often see offers, with funding frequently landing in 24-48 hours. It is faster and more forgiving than a bank loan, but it costs more — so it fits time-sensitive needs like payroll, materials, and mobilizing a new job far better than long-term or low-margin financing.
Key takeaways
- Approval leans on bank-deposit history and monthly revenue, not credit score alone — a fit for lumpy construction cash flow
- Typical starting point: ~$10,000 minimum, FICO around 500+, and 3-6 months of business bank statements
- Funding often lands in 24-48 hours after you accept an offer
- Repaid as a small daily or weekly ACH share of revenue, usually over about 3-12 months
- Cost is a factor rate (for example 1.2-1.5), not an APR — it costs more than a bank loan
- Many funders can approve on deposits rather than an SSN, and some accept an ITIN; requirements vary and are not legal advice
- Best for time-sensitive, high-return needs like materials and payroll — never marketed as guaranteed
Why revenue-based financing fits construction and contractors
Construction cash flow is famously uneven. You front the cost of labor and materials, then wait weeks — sometimes months — to get paid on a draw schedule, a progress invoice, or after retainage is released. A traditional term loan wants a clean, predictable monthly payment; your bank account doesn't work that way. Revenue-based financing is built around exactly this mismatch.
Because a revenue-based funder underwrites primarily on your bank deposits and monthly revenue, a contractor with real jobs moving through the account can qualify even with a bruised credit score or thin business-credit file. Repayment is taken as a fixed small percentage or fixed small amount of revenue, usually by daily or weekly ACH, so heavy-revenue weeks and slow weeks are both accounted for. For a trade business that needs to mobilize a crew, buy materials before the deposit clears, or cover payroll between draws, that speed and flexibility is the whole point.
Common uses contractors fund this way:
- Buying materials up front for a newly awarded job
- Covering payroll while waiting on a progress payment or retainage
- Renting or repairing equipment mid-project
- Mobilizing a second crew to take on overlapping jobs
- Bridging a net-30 / net-60 gap on a commercial invoice
Realistic qualification for a construction business
Qualification is deposit-driven, but it is not automatic. Here is what a revenue-based/MCA marketplace typically looks at for a contractor, and what makes an application stronger or weaker.
| Factor | Typical expectation | What helps a contractor |
|---|---|---|
| Monthly revenue | ~$10,000+ in deposits | Steady deposits across the month, not one lump then nothing |
| Time in business | Often 4-6+ months of history | Consistent operating account with real job income |
| Credit score | FICO around 500+ | No recent bankruptcies; score matters less than cash flow |
| Bank statements | Last 3-6 months | Few or no negative-balance days and NSFs |
| Business account | Dedicated business checking | Job income flowing through one account, not personal |
The single biggest lever is your bank statements. Frequent overdrafts, many negative-balance days, or already carrying several active advances ("stacking") will shrink offers or lead to a decline. Clean, consistent deposits do the opposite.
On ITIN and no SSN: many revenue-based funders in this marketplace can approve based on business bank-deposit history rather than a Social Security number, and some accept an ITIN. Requirements vary by funder and are not guaranteed, so confirm before you apply. This is general information, not legal or immigration advice.
What to expect: structure, speed, and repayment
Revenue-based financing in this marketplace usually takes the form of a merchant cash advance or a short revenue-share agreement. You receive a lump sum today and repay a set amount that is a small slice of your revenue, collected by ACH.
- Application: a short form plus your last 3-6 months of business bank statements. No lengthy tax-return package like a bank loan.
- Decision: often same day once statements are in.
- Funding: frequently 24-48 hours after you accept an offer.
- Repayment: fixed daily or weekly ACH, typically over roughly 3-12 months.
- Cost: quoted as a factor rate (for example 1.2 to 1.5), not an APR — you agree to pay back the advance times that factor.
Because construction revenue is lumpy, ask specifically about how the ACH is sized and whether any hardship or reconciliation option exists for slow weeks. Get the total payback amount and the daily/weekly draft in writing before you sign.
Example scenarios and amounts
These are illustrative only — actual offers depend on your statements and the funder. Figures are rounded and labeled for example.
| Contractor profile (for example) | Monthly revenue | Example advance | Example factor | Example total payback | Example term |
|---|---|---|---|---|---|
| Small residential remodeler | ~$25,000 | ~$20,000 | 1.30 | ~$26,000 | ~6 months |
| Growing electrical sub | ~$60,000 | ~$50,000 | 1.28 | ~$64,000 | ~8 months |
| Concrete / site-work crew | ~$120,000 | ~$100,000 | 1.25 | ~$125,000 | ~10 months |
Reading the first row: a remodeler taking a ~$20,000 advance at a 1.30 factor would repay about $26,000 total — roughly $1,000 more per $5,000 borrowed than the cash received — spread over about six months of weekly ACH pulls of roughly $1,000. Whether that math works depends on the margin on the work it lets you take. If a $20,000 advance lets you close a job that nets $40,000, the cost is easy to justify. If it is covering a thin-margin overrun, be more cautious.
The honest tradeoffs
Revenue-based financing buys speed and flexible approval, and you pay for both. Know the tradeoffs before you commit.
- It costs more than a bank loan. Factor rates translate to a high effective cost, especially on short terms. It is best for high-return, time-sensitive uses — not long-term or low-margin financing.
- Frequent drafts hit cash flow. A daily or weekly ACH keeps pulling even during a slow stretch between draws. Size the advance so the payment survives your worst week, not just your best.
- Stacking is dangerous. Taking a second and third advance on top of one you already have is how contractors get underwater. Most reputable funders view stacking as a red flag too.
- Not the cheapest tool for every job. If you have time and strong credit, a bank line of credit, an SBA loan, or equipment financing will usually be cheaper. Invoice factoring may fit better if your problem is purely slow-paying customers.
- No guarantees. Approval, amount, rate, and speed all depend on your statements and the funder. Anyone promising "guaranteed" funding is a warning sign.
When another option may fit better
Revenue-based financing is one tool. Match the tool to the problem.
| If your situation is... | Consider first |
|---|---|
| Slow-paying commercial customers, net-30/60 | Invoice factoring |
| Buying a truck, excavator, or major tool | Equipment financing |
| Strong credit and time to wait | Bank line of credit or SBA loan |
| Fast cash, credit is bruised, deposits are steady | Revenue-based financing / MCA marketplace |
| Bonding capacity for larger public jobs | A surety bond program, not financing |
If the honest answer is "I need money in a day or two, my credit isn't perfect, but real jobs are running through my account," that is precisely where revenue-based financing earns its place.
How to apply and get the best offer
To move quickly and get the strongest offer through a revenue-based/MCA marketplace:
- Gather 3-6 months of business bank statements. This is the core of your file.
- Run income through one dedicated business account so deposits are easy to read.
- Clean up the recent weeks if you can — avoid negative-balance days before you apply.
- Know your number. Ask for the amount the job actually needs, not the maximum offered.
- Get the full terms in writing — total payback, factor, draft amount and frequency, and any fees — before signing.
Because a marketplace shops your file to multiple revenue-based funders, one application can surface several offers to compare on total cost, not just the advance size. Amounts commonly start around $10,000, and funding often lands within 24-48 hours of approval — but nothing is guaranteed until you have a signed offer in hand.
Frequently asked questions
Can I qualify with a low credit score?
Often yes. Revenue-based funders lean on your bank-deposit history and monthly revenue more than your FICO. Many approve around a 500+ score, because consistent deposits from real jobs matter more than credit. A recent bankruptcy or many negative-balance days will still hurt.
How much can a contractor typically get?
Amounts commonly start around $10,000 and scale with your monthly revenue and deposit consistency. As a rough guide, offers often land somewhere near your average monthly revenue, though this varies by funder and by what your statements show. Exact amounts are never guaranteed until you have an offer.
How fast is funding?
After you submit bank statements, a decision is often same-day, and funding frequently lands within 24-48 hours of accepting an offer. Timing depends on the funder, how quickly you return documents, and your bank.
Can I get approved with an ITIN and no SSN?
Many revenue-based funders can approve based on business bank-deposit history rather than a Social Security number, and some accept an ITIN. Requirements vary by funder and are not guaranteed, so confirm before applying. This is general information, not legal or immigration advice.
How is repayment structured?
Usually as a fixed daily or weekly ACH draft that represents a small share of your revenue, over roughly 3-12 months. Cost is quoted as a factor rate, not an APR — you repay the advance amount times that factor. Get the total payback and draft amount in writing before signing.
How is this different from invoice factoring?
Factoring advances cash against specific unpaid invoices and is repaid when your customer pays that invoice. Revenue-based financing advances a lump sum repaid from your overall revenue by ACH. If your only problem is slow-paying customers, factoring may be cheaper; if you need flexible cash fast against overall deposits, revenue-based financing fits better.
What documents do I need to apply?
Typically a short application and your last 3-6 months of business bank statements. That is far lighter than a bank loan's full tax-return and financial-statement package, which is part of why decisions are fast.
Is funding ever guaranteed?
No. Approval, amount, rate, and speed all depend on your bank statements and the funder's underwriting. Any lender or broker promising guaranteed funding is a red flag. A marketplace can shop your file to several funders, but nothing is final until you have a signed offer.
