Types of construction loans

Quick answer

The main types of construction business financing are equipment financing, working capital and lines of credit, commercial construction loans, fix-and-flip and hard money, invoice factoring, SBA loans, and term loans. Each solves a different problem.

The right choice comes down to what the money is for — buying a machine, covering a cash-flow gap, funding a build, or growing the business.

"Construction loan" isn't one thing. It's a whole toolbox, and using the wrong tool is how contractors overpay or get declined.

Here's every major type, what it's for, and where to dig deeper on each.

Key takeaways

  • → There's no single construction loan — match the product to the specific need.
  • → Equipment financing and factoring are the easiest to qualify for.
  • → SBA loans are the cheapest long-term money but the slowest to fund.
  • → Most established contractors keep two or three products in place at once.

Equipment financing

Finance machines and trucks with the equipment as collateral. It's secured, easy to qualify for, and works for new and used gear. See the full equipment financing guide.

Working capital and lines of credit

Bridge the gap between paying for work and getting paid. A line of credit or invoice factoring covers payroll and materials when clients pay slowly.

Commercial construction loans

Fund ground-up and development projects, released in draws as the build progresses. For income or for-sale property, start with commercial construction loans.

Fix and flip and hard money

Short-term, asset-based financing for investors and spec builders that funds purchase plus rehab and closes fast. See fix and flip loans.

SBA loans

Government-backed loans with the lowest rates and longest terms, for working capital, equipment, or real estate. The trade-off is a longer process — details in our SBA guide.

Term loans and business loans

A lump sum for one-time growth investments, repaid on a fixed schedule. Our construction business loans guide covers these and how to qualify.

How to choose

Start with the need, not the loan. Buying a machine points to equipment financing; a cash-flow gap points to working capital; a build points to a construction loan; growth points to a term or SBA loan.

Compare costs on our rates page, then pre-qualify. eBoost Partners matches you across six products on one soft-pull application through its construction business financing.

Related guides

Equipment financing

Finance machines and trucks.

Construction business loans

Term loans, startup, working capital.

Working capital & factoring

Bridge cash-flow gaps.

Commercial construction loans

Ground-up and development.

Fix & flip / hard money

Investor and spec financing.

SBA construction loans

Lowest long-term rates.

Frequently Asked Questions

What are the main types of construction business loans?
The core types are equipment financing, working capital and lines of credit, commercial construction loans, fix-and-flip and hard money loans, invoice factoring, SBA loans, and term loans. Each fits a different need.

Which construction loan is easiest to get?
Equipment financing and invoice factoring are usually the easiest. Equipment loans are secured by the machine, and factoring is approved on your customers' credit rather than yours.

Which construction loan is cheapest?
SBA loans typically carry the lowest rates and longest terms, in exchange for a slower 30–90 day process. Secured equipment loans are also relatively low-cost.

How do I choose the right type?
Match the product to the need: equipment for machines, working capital for cash-flow gaps, a construction loan for builds, fix-and-flip for investors, and SBA for the cheapest long-term money.