A draw schedule is the payment plan in the contract: 30% at signing, 30% at rough-in, 30% at finishes, 10% at final walkthrough, or whatever the two parties agreed. On a lender-financed build the bank sets it and inspects before each release; on a private remodel the contractor proposes it. A good schedule keeps the client's money slightly ahead of the contractor's outlay at every stage without front-loading so far that the owner objects or the state's deposit cap is breached.
A worked number
A $68,000 kitchen on 30/30/30/10: $20,400 at signing, $20,400 at rough-in, $20,400 at finishes, $6,800 at completion. Cabinets ($10,500) are ordered in week two and paid half down; if the rough-in draw lands in week four, the contractor floats the deposit for two weeks. Add a draw when the cabinets are delivered to the site and the float shrinks; a draw on the order itself isn't collectable in states like California, which tie progress payments to work done or materials delivered.
The mistake it hides
Treating the schedule as fixed once the scope changes. A change order signed in week six should carry its own payment terms, usually due on approval or at the next draw; folded silently into the final payment, it's the last thing the client wants to pay for and the first thing they dispute.
In Obra
Each draw is recorded as income against the project when it arrives, and change orders adjust the contract value the schedule is measured against, so what's left to collect always includes the extras. The retainage and progress billing calculator lets you test a schedule against the job's cost curve before you propose it.