Prequalification Is a Starting Signal, Not Money in the Account
A contractor gets an encouraging initial funding indication for a school renovation. The supplier asks for a nonrefundable deposit this Friday, but the customer will pay only after a completed milestone is inspected. The contractor must decide what can safely be committed before financing is final.
The preliminary result answers a narrow question
An early review can point to a possible path using limited facts. It does not establish that the provider has verified debt, ownership, bank activity, use of funds, or the contract. Ask who issued the indication, what assumptions it uses, and which conditions remain. The provider can change or decline the amount and terms during full review; even an approval may have steps before disbursement.
Make a four-date calendar: supplier deposit, labor start, first customer inspection, and expected customer collection. Put current cash and committed funding only on the dates they are actually usable. A tentative amount should not fill Friday's deposit box.
Negotiate the irreversible date
The contractor could ask the supplier for a smaller refundable reservation or staged deliveries while verification finishes. It may cost more than the early-order discount, but compare that cost with losing a deposit if financing conditions cannot be met. If the job includes a delay penalty, place that alongside the carrying cost of existing cash. Neither risk disappears because an online screen displayed an estimate.
Before signing, obtain written status, unresolved conditions, and the actual expected funding sequence from the party making the offer. Do not promise a work start to the customer based on an indication. The existing prequalification authority covers the early view; this decision concerns a contractor's cash commitments across its stages.
Approval is still conditional on the transaction working
If the customer inspection slips a month, the contractor must still pay crews and the financing payment. Reprice the job with that lag and a realistic rework allowance. If it cannot survive the delay, scale or renegotiate the job rather than applying to several providers without a credible payoff. Providers control approval, conditions, amount, and disbursement.
Commit only against cash the contractor can use.
Bring the contract, supplier deposit, inspection schedule, and current cash into the Funding Quiz. An early signal is useful for planning; it is not a substitute for a funded deposit.