How Can Contractors Finance Materials Before a Job Starts?

Underwriting review: Fundo Underwriting Team
Last updated: October 2026

Contractors can buy materials before a customer pays with a deposit, supplier credit, materials financing, or funds based on past sales. First, match the supplier’s due date to the customer’s payment date. Then fund the gap. Fundo offers Revenue-Based Financing for business use. A signed job contract alone does not guarantee approval.

The job is booked. The lumber yard wants payment. Your customer will pay after the first phase.

That gap can put a good job on hold. But before you fund the full order, check what must arrive now and what can wait.

What is material financing for contractors?

Material financing for contractors helps cover supplies needed to complete paid work. These may include lumber, tile, paint, pipe, or roofing products.

The term can refer to more than one way to pay. A supplier account, a plan that funds just the goods, and business funding can all work in different ways. Check who gets the funds, when you must pay, and what you can buy.

For labor and other project costs, see our broader guide to funding a new contract before getting paid.

Which route fits your materials order?

Ask for a payment tied to the purchase

First, discuss a deposit or a payment before a large order. State what it pays for. Put the terms in writing. Check any deposit rules that apply to the job.

For example, a client could pay for the tile before you book delivery. However, don’t count that cash as yours to spend until it clears.

Ask the supplier when payment is due

Next, ask about a trade account or credit terms. Net 30 generally means payment is due 30 days from the date set by the terms. It does not mean 30 days after your customer pays you.

Check credit limits, fees, and any guarantee. Also ask if you can split the order. Buying what you need for phase one first can cut the cash you need now.

Compare dedicated materials finance with business funding

With a plan that funds just the goods, ask who pays the supplier. Check which goods you can buy. Ask what happens if you send stock back or change the order.

If you have a business credit line, check its terms too. Revenue-Based Financing and merchant cash advances may also address a business cash gap. Compare total cost and how often money leaves your account.

Fundo’s offering discussed here is Revenue-Based Financing. The other routes show choices across the market. Fundo does not offer all of them.

Can Fundo funding cover materials for a new job?

A contractor who meets the requirements may apply with Fundo for business funds to cover supplies. Fundo looks at how the business earns and spends. It does not promise to fund the value of a materials quote.

Its requirements for business funding provide a starting point:

Fundo fact	What it means for your business
At least $1,500 in average monthly business revenue	The business needs a record of sales
At least three months in business	A new contract does not replace time in business
Consistent account activity	Fundo needs bank activity it can review
Published range of $500–$10,000	The offer is subject to review and approval
Sole proprietors and 1099 contractors may apply	An LLC is not required for every applicant
Personal checking may be accepted	The account must qualify for review

These are starting requirements. Meeting them does not guarantee funding. Also, Fundo’s current FAQs state that Fundo does not serve California or New York.

How much should you fund for the first order?

Start with the supplier’s full quote, including tax and delivery. Then subtract cash you can use without leaving other bills unpaid.

Take this small flooring job:

Materials order: $4,200
Less customer deposit received: $1,500
Less spare business cash: $700
Cash still needed: $2,000

This is a sample cash plan, not a Fundo offer or client case.

The $2,000 covers only this purchase gap. Keep room for labor, fuel, waste, and other job costs. Add any funding fees and the sums due under the funding terms to the full cash plan.

Then move the client’s next payment back two weeks. Can you still pay the crew and finish the job? If not, change the deposit, order size, or dates.

What should you check before placing the order?

Construction material financing needs to fit the purchase, the job, and the cash plan. Before you click “buy,” check five things:

• Price: How long does the quote hold? Does it include tax, freight, and unloading?
• Scope: Did the client sign off on the goods, quantity, and finish?
• Timing: When must you pay, and when will the goods arrive?
• Returns: Can unused stock go back? Are custom items final sale?
• Storage: Is there a safe, dry place to keep the order if work is delayed?

A bulk discount can look good on paper. Yet extra freight, storage, or unused stock can erase the saving. Compare the full cost of one large order with a few small ones.

Put the order on a simple job calendar

Write down four dates: when you must pay for stock, when it ships, when work starts, and when the client pays. Then check the gaps.

If goods arrive a week early, where will you keep them? If they ship a week late, can the crew still work? Ask the supplier which items are in stock and which have a long lead time.

You may need to buy a custom door now but wait to buy paint. That choice can free up cash for the part of the job that starts first.

What will Fundo check when you apply?

Fundo may review sales, deposits, cash flow, bank balances, returned items, current bills, and other funding. Its guide to bank-account underwriting explains that review.

Cash set aside for other jobs still matters. Don’t treat cash reserved for next week’s payroll as spare funds for this order.

The Fundo application process asks for basic facts and uses Plaid to check bank data. Fundo says it does not store bank login details through that connection.

Before you accept an offer, check the full cost. Know when debits start and how often they occur. Ask what steps to take if sales fall and you need a change in remittances. A late client payment does not mean debits will pause on their own.

Questions contractors ask before buying materials

Can I apply before the new job starts?

Yes. A business that meets the requirements can apply before work starts. At Fundo, the review still looks at past sales and bank data. The signed job alone is not enough.

Can I get material financing with no business revenue?

Fundo needs a record of sales and time in business. If this is your first job, ask if the client can pay for goods upfront. You can also ask the supplier about terms. Check the rules for each route.

Can I use invoice factoring before doing the work?

A signed job is not the same as an unpaid bill for work you have done. Factoring needs a valid invoice that meets its requirements. Invoices from past jobs may qualify, even if the new job has not begun.

Should I buy all the materials at once?

Only if the price, space, and job dates make sense. Small orders can cut the cash you need upfront. But you may pay more in freight. The price of stock could rise too.

Get the materials plan ready before the crew arrives

Confirm the quote, get the agreed deposit, and price the gap that remains. Then choose terms the business can support while the work gets done.

Need materials for your next job?

Apply for Fundo Revenue-Based Financing to see whether your business qualifies!

For business use only. Approval, funding amounts, and terms are subject to underwriting.