Build the budget and the capital stack side by side, and see immediately whether the project is fully funded — plus loan-to-cost, equity share and contingency as a percentage of hard costs. Runs in your browser; nothing is stored.
Please read first: This calculator is general educational information only. It is not legal, financial, tax, or accounting advice, it is not a loan quotation, and it is not a determination of eligibility, credit approval, or feasibility. Lenders, the SBA and USDA apply their own underwriting criteria to the specific transaction. Nothing entered here is transmitted, stored, or seen by us — every figure is calculated in your browser.
Uses of funds
What the project costs.
Sources of funds
Where the money comes from.
Funding gap
—
Total uses—
Total sources—
Contingency amount—
Hard costs (excl. land)—
Loan-to-cost—
Equity as % of total cost—
Contingency as % of hard cost—
How lenders read a sources and uses statement
The first thing a credit officer checks is that the two columns are equal. An unexplained gap means the budget is unfinished, and it is one of the most common reasons a submission comes back. The second thing they check is what sits inside the numbers: whether hard costs come from a real contract or an estimate, whether soft costs include the professional work the project actually requires, whether working capital is enough to reach stabilization, and whether the contingency is proportionate to how much design risk remains.
The third question is where the equity is. A statement that balances only because of a large seller note, a grant that has not been awarded, or equity that has not yet been contributed is a different transaction from one funded with cash already in the deal. Sources that are contingent should be identified as contingent.
Contingency, and why it is shown as a ratio here
Contingency is the most frequently understated line in a project budget, because it is the easiest one to cut when the numbers do not work. This tool computes it as a percentage of construction and site work and reports it back as a percentage of total hard costs, so the assumption stays visible. A project priced from early drawings carries more risk than one with a signed guaranteed-maximum-price contract, and the budget should say so.
What an appropriate level looks like depends on design completeness, procurement method and cost volatility in the relevant trades. Verifying that the budget is realistic — rather than simply arithmetically consistent — is part of the technical and financial analysis in a feasibility study. Once construction begins, the same budget becomes the baseline for project monitoring, which tracks cost-to-complete and contingency drawdown against it.
Common mistakes this tool exposes
No interest reserve. Construction interest accrues before the project earns anything. If it is not funded in the budget, it has to come from somewhere.
No working capital. A completed building with no operating cash is not an operating business.
Contingency set to make the deal balance. If the percentage drops every time the budget grows, it is a plug, not a reserve.
Counting uncommitted sources. Grants not yet awarded and equity not yet contributed should be flagged as contingent.
Omitting soft costs. Design, permits, legal and third-party reports are real cash and are frequently left out of early budgets.
Once the budget balances, the next question is whether the resulting debt can be serviced. Test that with the DSCR sensitivity calculator.
Frequently asked questions
What is a sources and uses statement?
It is the one-page summary of what a project costs and where every dollar to pay for it comes from. Uses list land, construction, equipment, soft costs, contingency, working capital and financing costs. Sources list each loan, the borrower’s equity, any seller note and any grant. The two columns must equal each other; if they do not, the project has a funding gap.
Why must sources and uses balance exactly?
Because an unbalanced statement means the project cannot actually be built as described. A shortfall has to be resolved before closing by adding equity, increasing debt, reducing scope or renegotiating price. Lenders treat an unexplained gap as evidence the budget has not been finished, and it is one of the most common reasons a submission is sent back.
How much contingency should a project budget include?
It depends on design completeness, procurement method, whether the contract is fixed price, and how volatile the relevant material and labor costs are. Ground-up construction generally warrants more than a straightforward acquisition, and a project priced from early drawings warrants more than one with a signed guaranteed-maximum-price contract. This tool computes contingency as a percentage of hard costs so the assumption is visible rather than buried.
What equity contribution will a lender expect?
That is set by the lender’s credit policy and by the specific program, and it varies with asset type, whether the business is a start-up, and whether the property is special-purpose. The calculator reports your equity as a percentage of total project cost so you can compare it against whatever your lender requires. It does not assert a required level, because there is no single one.
Does this reflect SBA 504 or USDA structures?
Not automatically. Program structures have specific rules about eligible costs, subordination, injection and what may be financed, and those rules change. Use this tool to build and test the budget itself, then confirm the structure against current program requirements and your lender. See our notes on SBA feasibility requirements and the USDA OneRD framework.
Is anything I enter here sent to Wert-Berater?
No. Everything is calculated in your browser. Nothing is transmitted, logged or stored, and no email address is required.
Wert-Berater, Inc. · 1968 South Coast Hwy, Ste 2382, Laguna Beach, CA 92651 · 111 Town Square Pl Ste 1238 PMB 657834, Jersey City, NJ 07310 · 539 W. Commerce St #8486, Dallas, TX 75208 · 66 W Flagler Street, Suite 900, PMB 12704, Miami, FL 33130 · +1 310-857-2443 ext. 800 · email · Blog Index · Privacy · Terms · Site Map
Legal disclosure. Wert-Berater, Inc. offices are mailing addresses only. Following the COVID-19 pandemic the firm has elected to work remotely; its office locations receive mail and are not staffed for visitors or in-person meetings. Headquarters mailing address: 1968 South Coast Hwy, Ste 2382, Laguna Beach, CA 92651.
Wert-Berater, Inc. is an independent provider of feasibility studies and other related services. The firm does not provide financing or equity investment advice, and does not arrange, broker, or place debt or equity capital of any kind.
All appraisal assignments are performed by Bruce E. Jones, MAI, ASA-GC, BCA, CMEA, a member of the Appraisal Institute since 2006, a staff member of Wert-Berater, Inc. and owner of Special Purpose Realty Valuation.
