What is the difference between a draw inspection and a final inspection?

Interim draws versus the final draw.

Most construction loans fund through a series of interim draws and one final draw. Each interim draw inspection looks at the work claimed in that request and reports percent complete by line item, with photos. The question is narrow: is the money being asked for supported by the work on site today?

The final inspection asks a broader question: is the project complete? It confirms that the scope in the plans and budget is in place, that the punch list is closed or documented, and that nothing funded earlier has been removed or left unfinished. It is usually the condition for releasing the last draw, which is often where retainage is held.

Three "finals" that are not the same.

Lenders see three different documents at the end of a project, and they do not substitute for one another.

• The lender's final draw inspection. Ordered by the lender, scoped to the budget, used to release the final draw. Government programs formalize it: the VA's Lenders Handbook devotes a chapter to construction inspections and lets a lender close on a "clear" final inspection report.
• The completion certification for the loan sale. Fannie Mae's Selling Guide describes a completion report, commonly on Form 1004D, with visually verifiable exhibits, when the appraisal was made subject to completion. That is a valuation step.
• The municipal final and certificate of occupancy. Issued by the local building department to confirm code compliance. It says nothing about the loan budget.

A file that contains only one of these has a gap the other two were meant to close.

Why it matters for lenders.

The final draw is where unfunded contingency, retainage and lien exposure all come due at once. A mechanic's lien attaches to the property by operation of law, so the last draw usually waits on final lien waivers as well as the inspection. If the final inspection is treated as a formality, the lender can release the last of its leverage before the work, the waivers and the occupancy approval have lined up. Writing the final inspection scope separately from the interim scope, and naming which other documents must accompany it, keeps that from happening.

How RAZE handles it.

In RAZE, interim draws and the final inspection are the same workflow with different required deliverables. The lender configures the final-inspection capture set in the Ordering Engine, the inspector completes it in the Mobile App, and the report is delivered in the same standardized format as every prior draw, so the full sequence from first draw to completion reads as one record.