Cost Reviews
What is a construction project cost review?
There are many variables associated with a construction project that can increase risk to the lender. Some examples are inaccurate budgets and completion schedules; incomplete plans; and an insufficient understanding of the building costs.
A cost review is a process by which a construction lender engages a third-party fund control company to help reduce these risks.
When delivering project cost reviews, QuickDraw Fund Control provides a complete analysis of a borrower’s construction project. During this important due diligence phase of the construction loan process, QuickDraw Fund Control provides the lender with information that helps to determine if the budget and cost forecasts look reasonable for the scope and purpose of the project. QuickDraw Fund Control’s precise assessment is based upon years of experience in funds control and is an indispensable asset to the lender during this critical step in risk mitigation.
Fund Control in Construction — The Process
QuickDraw Fund Control’s goal is to present validation for the sufficiency of proposed project costs.
To begin, QuickDraw Fund Control’s experienced team help mitigate risk by evaluating the following items:
- Borrower’s construction plans and specifications of proposed work
- Breakdown of overall construction budget
- Distribution of costs, including soft costs and municipal fees
- Conformity with building permit and zoning approvals
- Conditions of approval and off-site improvement requirements
- Proposed construction schedule
- Completeness of contracts, plans and other construction documents
- Review of architects, engineers and primary subcontractors
In many cases, QuickDraw Fund Control’s experts visit the construction site to assess risk factors. They also engage in investigative activities, such as meeting with the local municipalities, researching permit history and inquiring about improvements where posting a completion bond is required.
Once a project cost review is completed, QuickDraw Fund Control provides a comprehensive analysis to the construction lender, detailing the budget submitted by the borrower.
An Objective Opinion
QuickDraw Fund Control is thorough and unbiased in its collection and analysis of information to assist the lender in the underwriting process for a construction loan.
Without specifying the exact decision a lender should make, QuickDraw Fund Control examines every detail of the construction project in order to present a comprehensive financial picture. This impartial analysis of the project from an outside firm gives the lender the information they need to make an accurate credit decision.
Experts Who Understand Their Clients
QuickDraw Fund Control maintains a team of fund control experts who bring years of experience in construction and home building to the process of fund control in construction lending. This perspective is pivotal to QuickDraw Fund Control’s effectiveness and the value it brings to its clientele.
QuickDraw Fund Control’s specialists understand the unique needs of lenders, borrowers and general contractors. With decades of working knowledge of construction, the leaders at QuickDraw Fund Control recognize that borrowers are looking for speed, accuracy and responsiveness in a fund control company. Likewise, they understand that lenders are looking for precision, professionalism and objectivity.
QuickDraw Fund Control works diligently to meet and exceed the expectations of all sides when conducting project cost reviews, contributing to a smooth working relationship among the parties.