In a construction draw inspection, the lender hires a professional inspector to visit the construction site and assess progress. Ordering a draw inspection is a construction lending best practice used by most lenders and validates the progress in conjunction with disbursing funds.
The inspector is looking to show where the project is in relation to the timeline that was set out, check the accuracy compared to the original draw request, and review the budget. Draw inspections follow along with the builder so that both the project owner and the lender can ensure the loan proceeds are going into the collateral on the loan, and identify progress concerns as early as possible.
When completing a draw inspection, the draw inspector visits the site and performs many specific tasks. However, the following components are critical to ensure the successful completion of the inspection:
Site Verification
The first thing a draw inspector must do is to verify it is the correct property, which can be done by a photo of the address posted on the property, a building permit identifying the property, or meeting the owner/builder at the site location.
Site Visit
During the site visit, the construction superintendent (on commercial projects), should expect to spend time with the inspector to answer any questions that the inspector has. These questions most commonly focus on work that has been completed, the upcoming schedule, and potential delays. In addition, the draw inspector will look specifically at:
- The security of the job site and the materials on the site
- How much work is going on at the job site
- Any stoppages, delays, or other circumstances affecting the progress of the job
Photos
As one of the main aspects of a draw inspection, photos are particularly important for lenders’ reference. They also provide proof that you conducted a thorough inspection should a claim arise. From a risk management perspective, photos can prove what was there on the day of the inspection—and what wasn’t. The more photos, the more equipped the draw inspector is to dismiss a frivolous claim or help answer any questions the lender may have.
Detailed Comments
The draw inspector’s comments validate the inspector’s findings, can help to explain any differences between what is completed and what is not, and help lenders understand a project’s progress and percentage completion of each line item.
With 50+ years of experience in the construction industry across all 88 counties in Ohio and now in surrounding counties in Pennsylvania, Michigan, Indiana, and Kentucky, McSteen is well equipped to tackle your draw inspection needs.
We get what you need fast to ensure there is no delay in funding a draw.
- Simplified quoting with one statewide price per site visit.
- Professional report by our professional team, including a completed draw schedule and internal and external progress pictures.
- Two-step verification between our in-field inspector and in-office review.
Contact us today for more information or to get started.
