203K Loan help--for Draws

We have recently closed on a Victorian that needs a lot of work, and we purchased it with a 203K loan, which appears to be a certain kind of hell. No that we are getting started with the renovation, the contractors–who of course signed the long FHA contract-are saying they need upfront money to get started; although it WAS made clear to us all by the FHA consultant and the mortgage broker there IS no upfront money, we and the contractor just assumed it would work itself out. Now we have two guys at the house when we need 10; we are supporting rent on two apartments as well as the house mortgage. The contractors are waffling on getting more guys there because they say they need more $$ upfront for their payroll. We also have just found out–when we called the FHA consultant after the first week of work to get a payout to keep this process going–that there is only a finite number of draws we can get and they have to wait to build up expenses to submit for work done. The contractor is getting
a little nutsy looking for loopholes (Or asking us to), and we are tapped out after buying the place. If we had the cash available we would advance it to contractors; our attorney said it happens a lot and you just cut a side deal with them to get reimbursed after their first draw check. But we don’t have it. My question is: has anyone else been in this situation? Can you offer us advice? Is there a magic way to ‘build up’ the draw request so they can get as much reimbursement ASAP and get this thing going? I am seeing this dragging for a long time. It’s not a question, BTW, of their integrity (contractors)–we examined their work and asked questions of all their clients we could find and noone had a bad thing to say (and their work is stellar).

Thanks in advance for any info….