Skip to main content

Contact Us For A Free Consultation

(303) 268-2867

Construction Project Financing And Payments Lawyers In Colorado



Paying for a construction project often requires a construction loan. Obtaining a construction loan is complicated and requires more steps than getting a residential mortgage. In exchange for financing construction, the borrower, builders, and bank all work together to ensure that a project is successfully completed.

Fulfilling the requirements of a construction loan can be complicated and often requires reviewing, negotiating, and organizing hundreds of pages of documents. At Volpe Law, LLC, our team of Colorado construction attorneys is committed to helping you manage the construction loan and construction contracting process.


The majority of construction projects are financed by a bank or other lending institution that puts up the funding to complete the project. Construction loans are riskier for lenders than other kinds of loans because there may be no structure to secure the debt—if the project fails early on, the bank might not recoup its money.

For that reason, construction loans come with some exceptional and onerous requirements.

First, most lenders require borrowers to cover at least 20% of the initial cost of the loan, and they usually charge a much higher interest rate than they would for a traditional mortgage. Furthermore, in addition to a security instrument on the land to be developed, the lender might require personal guarantees and substantial assignments of rights in case of project failure. Construction loans will typically involve a promissory note, deed of trust, various guarantees, assignments, bonds, and finance statements, among other things.

Second, the money for the construction project is disbursed in stages so that the lender can be sure the project is progressing as planned. The bank may have appraisers and inspectors check the progress of the work and verify that it is on schedule before disbursing additional funds. The construction loan documents will often give the bank substantial rights to the property and management of the project if the need arises for the bank to protect its investment.


Lenders release funds for construction projects according to an agreed-upon payment and disbursement schedule. But it’s not automatic: Typically, the terms of the loan dictate that funding will be released only after the project manager or owner submits draw requests showing that certain milestones have been completed. This schedule must be reviewed, understood, and incorporated into the construction contract between the contractor and owner.

Draw requests generally include documents like invoices and receipts for materials and labor. They may also include a schedule of values showing what work the crews have completed and what they have left to do; change orders indicating any modifications to the construction plan; and lien waivers from contractors. Because mechanic’s liens are the contractors’ primary means of ensuring they are paid, a lien waiver acts as a receipt of payment for any work performed, ensuring no more payment disputes will arise as to the prior work completed.


Negotiating a construction loan and complying with all of its requirements can be a difficult and time-consuming process. Let the attorneys at Volpe Law, LLC, assist you in staying on top of your legal obligations. Contact us online or call today to learn more about how we can help.


The information contained on this website is provided for informational purposes only. It is not legal advice and should not be construed as providing legal advice on any subject matter. Laws frequently change and therefore this content is not necessarily up to date, nor comprehensive. Contact us or another attorney with any legal questions specific to your matter. You may request a consultation by completing our consultation request form.

Contact Us Today

Volpe Law is committed to answering your questions about Civil Litigation, Real Estate, Construction, Business Litigation, Breach of Contract, Tort Litigation, Mechanics’ Liens, and Contract Review & Drafting in Colorado.

We offer a Free Consultation and we’ll gladly discuss your case with you at your convenience. Contact us today to request an appointment with one of our attorneys.

Office Location

Directions to Volpe Law

19751 E. Mainstreet, #342
Parker, CO 80138

Phone: (303) 268-2867

Mon, Tue, Wed, Thu, Fri: 09:00am - 05:00pm

The material on this site and on any third-party web site link included on the Volpe Law, LLC website is for informational purposes only. Nothing on this website may be construed as legal advice. Laws frequently change and therefore this content is not necessarily up to date, nor comprehensive. Contact us or another attorney with any legal questions specific to your matter. You may request a consultation by calling us at 303-268-2867 or completing a consultation request form. Using this website, filling out any forms, or communicating with Volpe Law, LLC through this site does not form an attorney/client relationship. Your matter may be subject to time limitations. You may be barred from taking any action if you do not timely act. Using or interacting with this website does not constitute your reliance on Volpe Law, LLC to take any action to represent you or preserve any claim that you may have or may assert. Please see Terms of Use for further information.