Renovation Evaluation & Contractor Due Diligence
Underwriting-grade review of single-family renovation contractors and their project documents. Before a single dollar is drawn, we tell you whether the contract, the budget, and the plans actually line up — and where the exposure is hiding.
The Problem
Single-family renovation financing is exposed at the point of contractor selection. The documents that drive the loan — the construction contract, the cost estimate, the spec book, the plans — are rarely reviewed together by someone who understands both construction and credit risk. Gaps surface after funds are disbursed, when they are expensive to cure and easy to litigate.
Every item above appeared in a single recent $316,000 addition project we reviewed. None are theoretical. All are discoverable before closing — if someone with the right lens looks.
The JDMC Review
A structured, repeatable review of a contractor and their project documents. Every finding is classified so credit, broker, and investor decisions can be made quickly and defensibly.
What We Review
Eight areas of analysis, one defensible deliverable.
Document Inventory
Plans, contract, estimate, spec book, license, COI, and contractor questionnaire — confirmed present, dated, and properly executed. Missing items logged as pre-review conditions.
14-Element Contract Audit
Contractor contact info, drawings, detailed cost estimate, scope, signatures, permits/fees, options/upgrades, exclusions, duration, payment terms, budget/total, allowances, change orders, and warranties.
Contract Special Notes
Plain-language readout of what the underwriter needs to know that won't show up on a checklist — cost-plus structure, markup application, late-fee math, warranty conditions, contingency, uncredited deposits.
Line-Item Cost Analysis
Trade-level review of the proposal with math validation against the stated contract total and hard-stop check for material discrepancies.
Allowance Identification
Every allowance pulled out, priced, and evaluated for specificity. Low-specificity allowances flagged as future change-order risk.
Plan Alignment
Each significant plan element traced into the proposal. Gaps, omissions, and scope-dependent items surfaced before funding.
Market Cost Analysis
Trade-by-trade comparison against regional market ranges with Above / Within / Below Market classification and variance notes.
Credentialing
State license verification, insurance review, and contractor questionnaire intake. No license, no report.
Who We Serve
Financial Institutions
Banks, credit unions, and private lenders funding renovation loans. Independent, construction-literate reviews drop straight into your credit file and give your committee a defensible PASS/FLAG/FAIL read before the first draw.
- Pre-closing contractor vetting and contract review
- Draw inspection and change-order review
- Post-closing workout support when projects slip
- Third-party report for loss mitigation defensibility
Mortgage Brokers
Brokers placing renovation, construction-to-perm, and fix-and-flip loans. A JDMC report strengthens submissions, gives underwriters something to work with, and protects your borrower from a contract that won't survive a draw schedule.
- Submission-package enhancement for tough files
- Borrower protection on contractor selection
- Faster conditions clearing
- Referral-friendly engagement model
Investors & Flippers
Single-family investors and flippers where returns live and die on the gap between the estimate and the actual cost. We give you a pre-construction read on whether the contractor's number is defensible — before the contract is signed.
- Pre-signing proposal review and market benchmarking
- Contract negotiation support (GMP, contingency, exclusions)
- Scope-to-budget reconciliation
- Go/no-go guidance on unfamiliar contractors
Sample Findings — $316K Primary Suite Addition
Excerpted from a recent JDMC Renovation Evaluation Report. Borrower, contractor, and property information redacted. Every evaluation is 100% customizable to client needs.
Contract references $1M+ general liability and workers' comp, but no Certificate of Insurance was provided. Underwriting condition recommended prior to first draw.
Contract signed by contractor; homeowner signature lines blank. Estimate signature block also not executed. Neither document fully executed.
Cost-plus with 20% markup and no Guaranteed Maximum Price. Contract states final bill 'may vary from the initial estimate.' Stated total is a projection, not a ceiling.
1% per week compounding late fee beginning day 11 — approximately 52% annualized. Industry standard is 12–18% annualized.
No contingency line item. Industry standard for renovations is 7–10%. On a $316K project with asbestos, structural integration, and unknowns, ~$22K–$32K of exposure is unbudgeted.
1-year workmanship warranty is conditional on final invoice paid in full. If a quality dispute causes the homeowner to withhold payment, warranty protection may be lost.
Structural plans stamped by licensed PE. Contractor license active and verified. Permits line item present in the estimate.
How an Engagement Works
Intake
Client sends contract, estimate, plans, spec book, license, and COI through a secure client portal.
Document Inventory
We confirm everything we need is present, dated, and signed. Missing items are logged as pre-review conditions.
Contract & Cost Review
14-element audit, line-item cost analysis, allowance extraction, and special-notes writeup.
Plan Alignment & Market Cost
Plan-to-estimate crosswalk and trade-by-trade benchmarking against regional market ranges.
Report Delivery
Formatted PDF report delivered to the client. Standard turnaround is a small number of business days from complete intake. Rush available.
Follow-up & Draw Support
Optional ongoing engagement: draw inspections, change-order review, and workout support.
Why JDMC
Construction-literate. We read plans, estimates, and contracts the way a GC reads them — then translate into the language an underwriter or investor needs.
Underwriting-grade output. Every finding is classified PASS, FLAG, or FAIL with defensible reasoning that drops straight into a credit file or investment memo.
AI-powered, human-reviewed. We use AI to accelerate document review and market-cost benchmarking, then a construction professional validates every finding before it ships.
Tertiary-market focused. We specialize in the single-family renovation markets where national review services don't play — where tribal knowledge of contractors, permits, and labor rates matters.
Independent. We don't sell contractors, we don't earn commissions on loans, and we don't bid the work. Our report is the product.
Ready to see a sample review?
Competitive pricing. Every evaluation is 100% customizable to client needs. Contact us for engagement terms, turnaround, and references.
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