What is retainage?

Retainage is an amount of a construction draw that is not funded, or “retained”, by a lender. It is typically used when a lender is not funding 100% of construction. The amount by which each draw is reduced, and thus retained by the lender, is the retaining. For example, if a lender is only funding 90% of construction, the retainage would be 10% of each construction draw.

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