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How to write a scope of work lenders approve
A scope of work is the itemized plan and budget for your renovation. Bridge lenders use it to size the rehab loan, check your after-repair value, and schedule draws. Here's how to build one, plus a free budget builder.
What is a scope of work?
It's the line-by-line list of the work you'll do on a property and what each item will cost. For a bridge loan with rehab funding, it's one of the most important documents in the file.
Lenders use it to decide how much of the rehab to fund, to check that your after-repair value (ARV) is realistic for the finish level you're planning, and to set the draw schedule that releases repair money as the work gets done.
- Sets how much rehab money the lender funds
- Supports your after-repair value
- Becomes the draw schedule during the project
- Shows the lender you've planned the job
Checklist
What a good scope of work includes
The more specific it is, the faster underwriting can approve it.
Line items by category
Roof, kitchen, baths, mechanicals, and so on. Each with a description and a cost, not one lump sum.
Materials and finish level
Say what's going in: LVP or hardwood, laminate or quartz. Finishes should match the comps behind your ARV.
Contractor bids
Attach bids for the big items. Lenders trust numbers that come from the people doing the work.
Permits and fees
List permits, inspections, and dumpsters. Check your city and county codes first.
Timeline
Roughly when each phase happens. It drives your draw schedule and your loan term.
Contingency
Build in a cushion for surprises behind the walls. Many investors plan 10–15%.
Free tool
Scope of work budget builder
Fill in the categories that apply. Totals update as you go. Download it as a spreadsheet or print it.
Nothing you type here is sent anywhere. Download it and attach it to your pre-approval request. Some lenders also have their own scope of work form.
Tips
Tips for faster approval
How detailed should it be?
Detailed enough that someone else could price the job from it. "Kitchen: $25,000" gets questions. "Kitchen: new shaker cabinets, quartz counters, stainless appliances, LVP flooring: $25,000" gets approved.
Who should write it?
You and your contractor, together. Walk the property with the contractor, then build the budget from their bid.
Can I change it after closing?
Usually, with the lender's approval. Most lenders handle changes as a revised budget or change order. Big changes can affect your draws, so talk to the lender first.
How do draws work?
Finish a phase, send the lender photos and invoices, and an inspector confirms the work. Funds are released after that, usually within a few days. Read more about draws.
Budget ready?
Attach it to your pre-approval request and we'll find the lenders that fit the project.