Construction finance requirement calculator
Construction finance should cover the deepest point of your project's cash flow after promoter equity, plus the interest it runs up. This model builds that cash flow month by month: costs as construction progresses, sales at your expected pace, buyer payments capped at the MahaRERA model agreement's stage limits, and the RERA Separate account rule. It then shows the peak funding gap, the loan needed, interest during construction and when sales repay it.
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Calculator
Summary
Month-by-month cash flow
The row at the peak loan balance is shaded; the occupancy certificate month is in bold.
Your figures stay in your browser. The link you copy contains them, so share it only with people you trust.
How this is calculated
Costs
- Land is either already paid (it then counts as equity brought in and as cost incurred for RERA) or payable in month 0. If land payable exceeds the equity entered, the shortfall is shown separately and kept out of the construction loan, because banks may not fund land acquisition by private builders.
- Approvals and premiums are spread evenly over the months you choose, from month 0.
- Construction is spread over the construction period either in equal amounts or on an S-curve, where the cumulative share spent after a fraction x of the period is x² × (3 − 2x).
- Marketing and overheads are spread evenly from month 1 to the OC month. GST is left out on both sides as a pass-through.
Sales and collections
- The share of area sold is the launch figure in the launch month, rising by the monthly rate until everything is sold. Revenue = carpet area × price.
- A buyer pays the booking % in the month of sale and, from the following month, the higher of the agreement % and the stage cap reached by then. Everything is due from the OC month. Buyers who book late pay all the stages already reached at once.
- Stage caps follow clause 1(c) of the model agreement for sale in the Maharashtra RERA Rules, 2017: 10%, 30%, 45% (plinth), 70% (slabs), 75%, 80%, 85%, 95% and 100% on possession. Each construction stage is linked to a % of construction cost spent. With floor-by-floor slab billing, the cap rises evenly from 45% to 70% between plinth and the last slab.
- Collections arrive in the month they are due. In practice buyers pay late and some cancel; test slower sales to allow for this.
The RERA Separate account
Usable inflow = (1 − d) × collections + withdrawals from the Separate account
Cumulative withdrawals ≤ the lower of: cumulative deposits, and land + approvals + construction + interest incurred
- d is 70% (or 100% where receivables are below the balance cost) under section 4(2)(l)(D) of RERA and MahaRERA Order 56/2024. The cap on withdrawals is the Form 3 method in MahaRERA Circular 7/2017: total estimated cost × (cost incurred ÷ total estimated cost), which equals the cost incurred. Marketing and overheads are not counted.
- After the OC, the whole balance is released, as Circular 7/2017 allows on receipt of the completion certificate.
- Withdrawals in the model are immediate; in practice each one needs Forms 1, 2 and 3, so allow for a lag of a few weeks.
Funding, interest and repayment
- Promoter equity is used first. When cash would go below zero, the loan is drawn for the shortfall.
- Interest = opening loan balance × annual rate ÷ 12 each month, paid from the project's cash flow (and so drawn from the loan when cash is short). Interest up to the OC month is shown as interest during construction.
- Repayment. After the last drawdown, surplus cash is swept to repay the loan, but never so much that the project would need to borrow again later.
- Peak funding gap is the lowest point of cumulative (usable inflows − costs) before equity, loan and interest. Construction finance needed is the peak loan balance in the model.
What lenders will also look at
A lender sizes the loan on its own appraisal, not on this model alone. It will check the promoter's track record and equity, clear title, approvals and MahaRERA registration (disbursement only after clearances), the cost and means of finance, sales velocity and receivables cover, and the security on offer. RBI's 2025 Directions bar banks from financing land acquisition by private builders, require builders to name the mortgagee bank in brochures and advertisements, and, for loans under the project finance framework, require stage-wise disbursement certified by the lender's engineer. Read how lenders assess construction finance and what the 70% account means for lenders: the Collection and Separate accounts cannot carry a lien or escrow, so repayment is structured around the Transaction account and properly withdrawn funds.
A planning model. Use it to frame the discussion with lenders and to test sensitivity: slower sales, a later launch, higher cost or a higher rate. It is not a project report and not a sanction formula.
Questions people ask
How do I work out how much construction finance my project needs?
Build a monthly cash flow of costs and usable collections, find the lowest point of the cumulative balance (the peak funding gap), subtract the promoter equity you will bring in first, and add the interest the loan will accrue until sales repay it. Lenders will run their own version, with their own assumptions on sales pace and cost.
Can a bank fund the land cost?
No. RBI's Credit Facilities Directions, 2025 say a bank shall not extend fund-based or non-fund-based facilities to private builders for acquisition of land, even as part of a housing project. Land has to come from promoter funds or, where their policies allow, NBFCs and housing finance companies. The calculator never funds land from the construction loan.
Does the RERA 70% account increase the loan I need?
Usually not by much. Under MahaRERA's Form 3 method you can withdraw from the Separate account up to the land and construction cost actually incurred, so collections that only reimburse cost are released. What the rule does is hold back collections that run ahead of cost, which is mostly your margin, until the occupancy or completion certificate. The model shows how much is held back and whether it adds to the loan or delays repayment.
Can buyers be asked to pay more than the construction stage allows?
The MahaRERA model agreement for sale caps cumulative payments by stage: 10% before the registered agreement, 30% after it, 45% on plinth, 70% on slabs, then 75%, 80%, 85% and 95% on later stages, and the balance on possession after the occupancy or completion certificate. Section 13 of RERA separately bars taking more than 10% before a registered agreement.
Why does the model use promoter equity before the loan?
Lenders expect promoter contribution to come in first, or at least in proportion, and RBI requires banks to verify the source of promoter equity. Using equity first is also the cheaper order for the developer.
Is anything I type stored or sent to Biz Corp Solutions?
No. The calculation runs entirely in your browser. Your inputs are only kept in this page's web address so you can copy a link and share the same model with your CA or lender.
Raising construction finance for a project?
We arrange construction finance of ₹5 crore to ₹500 crore. Send us your project numbers and this model, and we will tell you how lenders are likely to size and structure the loan.
This is a planning model, not a lender's sanction formula. Lenders size construction finance on their own appraisal of cost, sales, cash-flow cover and security, and must follow RBI's directions. Lenders, regulators and government offices apply their own rules and may round or calculate differently; their figures prevail. Biz Corp Solutions arranges funding through partner banks, NBFCs and financial institutions, and lenders decide sanction, rates and terms. Last reviewed 5 October 2026.