Pre-closing review happens after the loan is approved but before funds are disbursed for construction. It is the last structured opportunity to confirm that plans, specifications, contracts, and budgets align with what the lender underwrote — and to catch gaps that are far cheaper to fix on paper than in the field.
What Gets Reviewed
A thorough pre-closing package typically includes:
- Comparison of the construction budget to the approved loan amount and contingency.
- GC contract terms related to payment, changes, schedule, and warranties.
- Plan and specification completeness for major building systems.
- Insurance, bonding, and licensing requirements for the contractor.
- Alignment between the draw schedule and the schedule of values.
Outcomes Lenders Should Expect
The review should produce a written report with findings classified by severity — items that must be cured before first draw, items to monitor during construction, and recommendations that strengthen the lender’s ongoing oversight.
When findings are addressed before closing, the first draw becomes a verification step instead of a discovery process.
"Closing without a construction documents review shifts risk from preventable to probable."