Free Construction Loan Draw Calculator
Calculate the draw schedule and interest costs for a construction loan based on the total loan amount, number of draws, interest rate, and construction timeline.
Amount Per Draw
$70,000
Amount Per Draw vs Construction Period (months)
Construction Loan Draw Schedules
Construction loans disburse funds in stages (draws) as building milestones are completed. Interest is charged only on the amount drawn, making the draw schedule critical for managing costs.
How Draws Work
1. The lender approves a total loan amount based on the construction budget 2. As each construction phase is completed, the builder requests a draw 3. The lender sends an inspector to verify the work is done 4. The lender disburses the next draw amount 5. Interest accrues on the cumulative balance outstanding
Typical Draw Milestones
Interest Calculation
Because the balance increases with each draw, the average outstanding balance is approximately half the total loan amount. Total interest = Average Balance x Monthly Rate x Months.
Example Calculation
$350,000 construction loan, 5 draws, 9% annual rate, 8-month construction, 2% origination, $250 inspection per draw.
- 01Amount per draw: $350,000 / 5 = $70,000
- 02Average outstanding balance: $350,000 x (5 + 1) / (2 x 5) = $210,000
- 03Monthly rate: 9% / 12 = 0.75%
- 04Total interest: $210,000 x 0.75% x 8 = $12,600
- 05Origination fee: $350,000 x 2% = $7,000
- 06Inspection fees: $250 x 5 = $1,250
- 07Total financing cost: $12,600 + $7,000 + $1,250 = $20,850