Construction Draw Review & Administration

The draw is where exposure is created

A construction loan is disbursed in pieces, and each disbursement is the moment risk enters the loan. Over-funding relative to real progress, a duplicate or unsupported cost, an unreleased lien, or a change order that quietly erodes contingency — these are the events that turn an on-paper loan into a problem. Independent draw review is the control that catches them before the money moves.

ALLOT reviews draws for the lender or capital partner, applying the same test every cycle: is each requested dollar supported by documentation and by work actually in place?

Document intake

Each draw package is logged and checked for completeness before substantive review begins — the payment application, supporting invoices and receipts, lien waivers, updated schedule of values, change-order log, and any stored-materials documentation. Missing or inconsistent items are identified at intake rather than discovered late.

Payment application & schedule-of-values review

We reconcile the payment application to the approved schedule of values line by line, confirming that percent-complete claims are internally consistent, that prior payments and this period's request add up, and that the math ties to the contract sum. We work with AIA G702/G703 applications and equivalent payment-requisition formats.

Invoice, lien-waiver, change-order, retainage & contingency review

• Invoices & costs — supported, non-duplicative, and within the corresponding budget line;
• Lien waivers — collected and matched to prior and current payments across the contractor and subcontractor tiers;
• Change orders — reviewed for authorization and for their effect on the contract sum, contingency, and completion cost;
• Retainage — held, tracked, and released consistent with the loan and contract terms; and
• Contingency — drawdowns evaluated against the work remaining, so the reserve is not exhausted before the project is complete.

Field-progress reconciliation

Paper alone is not enough. We reconcile the payment application against observed physical progress on site, so that percent-complete on the requisition reflects what is genuinely installed. Draw review and site verification are two halves of the same control — the detailed monitoring cadence is covered under Construction Loan Monitoring.

Exception resolution & funding recommendation

Where items don't reconcile, we document the exception, quantify it, and work through resolution with the appropriate parties rather than simply rejecting the draw. Each review closes with a clear, documented funding recommendation — the supported amount, any holdbacks, and the conditions attached — that the lender can act on and retain as evidence of a disciplined disbursement process.