Contractors: The 3 Numbers Banks Need Before Approving Your Loan

If you're a contractor looking to secure a loan, it's not enough to just show strong revenue or a packed schedule. Banks aren't impressed by how busy you are; they want to see if your business is financially sound, sustainable, and structured for repayment. In this article, we'll break down the three essentials every bank—and bonding company—wants to see before saying yes to your loan request.

Unfortunately... Most contractors unintentionally sabotage their own financing chances.

Teaser Alert: Keep reading to see how an Electrical Trade Contractor from Maryland received $500K in bank financing.

Here Are the Most Common Reasons Why:

Reason #1: Your financials are inaccurate or unclear. Many contractors run lean, using their accountant for taxes and relying on spreadsheets or ad-hoc systems to track expenses. But banks need to see professionally maintained, accurate, and timely monthly financial statements.

Reason #2: You don't have a credible financial forecast. Without a 12-month plan and a 3-year projection, the bank has no roadmap to judge your ability to repay the loan. A forecast isn’t fluff—it’s proof of foresight, discipline, and planning.

Reason #3: You're asking without leverage. Applying for financing without solid backup—like a WIP schedule and backlog—makes you look desperate, not credible. Banks fund businesses that know will pay them based on facts not fantasy.

💡 Stats to Consider: (Source: Billd Industry Report 2025)

• 64% of subcontractors report being slow paid by general contractors, creating widespread cash flow instability.

• Subcontractors wait an average of 56 days to get paid after submitting a pay application—yet GCs believe it’s only 30 days.

• 1 in 3 subcontractors dip into personal or retirement savings to cover cash deficits caused by delayed payments.

• Nearly 3 in 4 business owners don’t take regular profit distributions, only pulling profit when cash flow allows—or not at all.

• 40% of subcontractors keep half or more of their profits in the business as working capital.

Here’s How to Fix That:

Step 1: Know Your Numbers Start with clear, accurate monthly financials. At a minimum, you need a P&L, balance sheet, and 12-month budget. These should be current, not something your CPA pulls together at tax time. Many clients come to me having been turned down from a lender because they didn't have their numbers in order. Once we cleaned up their books, they were shocked by how much opportunity they were leaving on the table.

Step 2: Build a 12-Month Plan and 3-Year Forecast Your plan should include realistic revenue targets, cost assumptions, and margin goals. A 3-year forecast is your proof of concept. Andrew, and electrician from Maryland executed their budget for a year and went from disorganized finances to bankable. They recently secured $500K in funding and finally have the working capital to grow responsibly.

Step 3: Get an Outside Financial Assessment You can't read the label from inside the jar. A professional assessment from someone who understands construction finance can surface blind spots and fast-track your credibility with lenders. Think of it like a financial checkup: you may feel fine, but that doesn’t mean everything’s running smoothly under the hood.

Recap: Banks don’t approve loans based on hustle—they approve based on financial clarity, foresight, and credibility. If you want to grow, you need to build financial trust. That starts by:

1. Knowing your numbers.

2. Planning ahead.

3. Getting an expert’s eye on your books.

Which stage are you at today?

• If you don’t yet know your numbers, let’s get your baseline.

• If you know your numbers, we’ll help you map out your 12-month and 3-year plan.

• If you’ve got both in place, let’s run a financial checkup and see what a lender would see.

It's so frustrating not having sufficient cash flow and capital to run your business. Let's start working on that today.

If you want help or to learn more, 👉 Reply “Blueprint” and I’ll get you the details.

Patrick Shurney, MBA
Founder, 3P Consulting
📞 443.539.6276
Helping Contractors Get Their Finances Sorted

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About Me:

As a veteran in financial coaching with over 30 years of corporate banking experience, my mission is to empower trade contractors like you to become numbers confident, optimize cash flow, leverage debt, and pay yourself competitively.

Ready for More?

Here’s how I can help you:

1. Profit Blueprint Program: Get your finances sorted and build out a 3-year financial roadmap in the next 30 days.

2. Loan Consulting: Get Bank Ready. With 30+ years of banking experience, I’ll make sure you're ready to approach lenders with a winning loan package.

Ready to take your financial strategy to the next level? Let’s connect and make sure you’re running a thriving business while paying yourself what you’re worth.