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Ryan G. WrightJul 28, 2016 4:01:32 PM2 min read

The Twelve Steps of the Draw Policy

The Investor’s Edge Draw Policy

Check you out! You found a great deal and now you’re working your rehab magic. There’s one little catch, though…the work doesn’t get done without money. So…


Fortunately, the answer is simple! As a hard money lender, we provide funding to cover the purchase price of your property, the rehab costs and many other costs and fees. However, the funding doesn’t appear magically in one lump sum. Like other lenders, we have a draw policy which gives clear expectations regarding when you’ll receive reimbursement for costs and fees. Unlike many other lenders, we want you to be 100% educated regarding our draw policy so that you’ll know exactly what to expect before you even begin the loan process with us.

So, we’ve whipped up a guideline for our draw policy!


  1. The borrower can receive 10% of the rehab money up front. This typically happens at closing.
  2. We operate off of the bid given and approved before the loan closes. Modifications to this bid have to be approved in advance by the Underwriter. If an item goes over the bid, the borrower needs to pay the difference out-of-pocket, unless another item is completed under-budget without sacrificing the quality of workmanship.
  3. There is a draw and inspection fee of $150. We have budgeted for four. If more occur, it will be shorted out of the draw sent out.
  4. You must submit reimbursement requests through our website. It cannot be done by email.
  5. Only work that is 100% complete will be refunded, once receipts or invoices are provided. Contractor’s lien releases will be required.
  6. The draw process typically takes about 5-7 business days from the time the draw request is submitted to the time the funds reach the borrower’s account.
  7. Contractors, sub-contractors or other labors to be paid directly, unless:
    1. The borrower has already paid them.
    2. The borrower is purchasing materials (Labor costs will be paid to the contractor).
  8. The borrower can only be reimbursed for materials paid for with a paid receipt. Materials must be installed before funds can be dispersed.
  9. Materials have to be permanently affixed to the property in order to be reimbursed. For example, cabinets which are on the property but not permanently installed do not qualify for reimbursement.
  10. Invoices cannot be hand-written. They must be an official invoice form with company name, letterhead, license and contact information included.
  11. Partial work per line item on the bid cannot be paid. The work must be 100% complete in order to be reimbursed.
  12. The borrower can be reimbursed for payment made to general contractors if the following criteria is received:
  • Paid invoice on letterhead of the contractor. Must include the phone number, address, name and license number of the contractor.
  • Lien release from contractor which states they were paid, the work they were being paid for and verifying the work is completed.
  • Inspection report which verifies the work is completed.
  • A recorded phone conversation with the contractor verifying the work was completed and they were paid. This must be uploaded into your members area.

We hope this answers any questions you may have about the draw policy! We’re dedicated to your success and are ready to show you the money!