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The Investor’s Advantage · Issue 02 · October 14, 2026

BearCrest Funding
THE INVESTOR’S ADVANTAGE   /   ISSUE 02

Hi, I’m Joel with BearCrest Funding. Welcome to Issue 02 of The Investor’s Advantage. This time, we’re looking at how your rate and draw process affect the cost of finishing your project.

FIX & FLIP · GROUND-UP CONSTRUCTION

A Lower Interest Rate
Can Still Cost You More.

When you compare loan offers, the interest rate gets your attention. But if your project slows down while you wait for construction funds, those savings can disappear quickly.

Your rate and your draws do different jobs.

The interest rate determines the cost of borrowing over time. Confirm whether interest is charged on funds already advanced or on the full committed loan amount.

A draw is a release of your construction or rehab funds. Many lenders release money after completed work is documented and inspected. You may need cash to cover that work before reimbursement.

Waiting for money can mean waiting to finish.

If a draw delay leaves you unable to pay your contractor or buy materials, work can stop. Interest keeps accruing on the applicable loan balance, and taxes, insurance, utilities and other holding costs continue. You may also face extension fees or lose your contractor's place on the schedule.

What does a one-month delay cost?

Assume a $300,000 average interest-bearing balance and a six-month project. Compare a 10% loan with a one-month draw-related delay against an 11% loan that finishes on schedule.

Cost10% loan11% loan
Six months of interest$15,000$16,500
Extra month's interest$2,500$0
Extra month's other holding costs*$1,000$0
Compared costs$18,500$16,500

The lower-rate loan costs $2,000 more in this example.

Illustration only; these are not loan quotes. Uses simple interest and annual rate ÷ 12, with the same $300,000 average balance over the first six months and a $300,000 balance during the extra month. *Assumes $1,000 in additional taxes, insurance, utilities and other non-interest holding costs. Common six-month holding costs are omitted from both columns. Origination, draw, inspection, extension and exit fees are excluded. Actual balances, timing, interest methods and costs vary.

Ask these questions before you commit.

  • How long does it take from a complete draw request to funds in my account?
  • What inspections, invoices and lien waivers are required?
  • Must I pay for work first? Are deposits or materials eligible?
  • What are the draw fees, inspection fees and holdbacks?
  • Who handles a delayed draw, and what happens if I need an extension?

Inspections and documentation serve a purpose. Submit complete requests and build realistic draw timing into your construction schedule and cash budget.

Compare the total cost of getting your project finished.

At BearCrest Funding, we can help you compare the rate, loan structure and draw requirements so you can choose financing that fits your project. Have a fix-and-flip or ground-up construction deal? Let's talk.

Let's discuss your project

Joel Vazquez · CEO
BearCrest Funding LLC
423-454-1055
jvazquez@bearcrestfunding.com

You see the opportunity, we fund it.
Financing is subject to underwriting, program availability and loan terms. Draw timing varies by funding partner, project and completeness of required documentation.

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