Progress Schedule Assessment

G'day All,

I've got a friend who's putting an application in for a duplex and as part of the Bank's assessment they'd like to see a Claim Schedule as documented by an Architect or Quantity Surveyor.

If anyone has used a Quantity Surveyor to put this Claim Schedule together, do they need to quote their AIQS membership number?

Or can someone who's simply reasonably qualified/experienced (i.e. 20 years as an estimator) provide the claim schedule on that basis?
 
What the? Why are they asking for a QS? I think the valuer is asking this and not the bank yeah?

What do you mean by a claim schedule? Do you mean progress payment schedule?

Is this a resi or commercial loan?
 
What the? Why are they asking for a QS? I think the valuer is asking this and not the bank yeah?

What do you mean by a claim schedule? Do you mean progress payment schedule?

Is this a resi or commercial loan?

Sorry, got my words mixed up, yes a progress payment schedule.

I'm not sure why they're asking for it, mate just came up and asked me the question and I thought I'd put it to the brains trust.

I'm fairly certain he told me it was the bank seeking the progress payment schedule, but maybe he used the wrong term?

It's a duplex so I'd assume resi.
 
Ah ok that make sense - yep its standard to submit a progress payment schedule as part of the construction loan docs.

What the issue? Hasn't the builder provided this? If not then get them to provide it.

This can come from the builder - doesn't need to be from a QS or architect.

QS report are mainly for commercial stuff.
 
If anyone has used a Quantity Surveyor to put this Claim Schedule together, do they need to quote their AIQS membership number?

Or can someone who's simply reasonably qualified/experienced (i.e. 20 years as an estimator) provide the claim schedule on that basis?
Does that person have professional indemnity insurance that covers them if they get it wrong?
I'm not sure why they're asking for it
To make sure they never get to a point where they've paid out more cash on the project than it's worth. It's to address their risk of loss if, for some reason, the project can't be completed and has to be liquidated as a part-complete project.
 
Ah ok that make sense - yep its standard to submit a progress payment schedule as part of the construction loan docs.

What the issue? Hasn't the builder provided this? If not then get them to provide it.

This can come from the builder - doesn't need to be from a QS or architect.

QS report are mainly for commercial stuff.

Ok, I'll advise him that builder can submit it. I thought it strange that they wouldn't accept one from the builder... seeing as how it's his quote they're relying on. But then I just thought maybe they'd want a second opinion.

I'll tell him to get his builder to provide one and away we go!

I tried to steer him towards somersoft for research, if he has more questions I will maybe pass on your details Shahin and hopefully something will come out of it for you and you can arrange his finance?
 
Ok, I'll advise him that builder can submit it. I thought it strange that they wouldn't accept one from the builder... seeing as how it's his quote they're relying on. But then I just thought maybe they'd want a second opinion.

I'll tell him to get his builder to provide one and away we go!
The builder has every incentive to get progress payments paid ahead of schedule, I'd be very surprised if the lender accepts it.
 
The builder has every incentive to get progress payments paid ahead of schedule, I'd be very surprised if the lender accepts it.

They will accept it for duplex type construction loans under resi.

What you are referring to is correct but its for the bigger stuff and mostly commercial.
 
Ok, I'll advise him that builder can submit it. I thought it strange that they wouldn't accept one from the builder... seeing as how it's his quote they're relying on. But then I just thought maybe they'd want a second opinion.

I'll tell him to get his builder to provide one and away we go!

I tried to steer him towards somersoft for research, if he has more questions I will maybe pass on your details Shahin and hopefully something will come out of it for you and you can arrange his finance?

Nah they will accept it. Just need to get both the customer and builder to sign it. Which lender is it?
 
Does that person have professional indemnity insurance that covers them if they get it wrong?

To make sure they never get to a point where they've paid out more cash on the project than it's worth. It's to address their risk of loss if, for some reason, the project can't be completed and has to be liquidated as a part-complete project.

If it's just a progress payment schedule, are you certifying the total value of the project or just the rate of cashflow for a project?

Wouldn't there just be an approved loan amount which is equal to something like project value + 5-10% (to account for unseen varies), and if that's exceeded then funds dry up?

I guess that does leave the bank with an incomplete project and no firm knowledge of the total cost til completion.
 
If it's just a progress payment schedule, are you certifying the total value of the project or just the rate of cashflow for a project?

Wouldn't there just be an approved loan amount which is equal to something like project value + 5-10% (to account for unseen varies), and if that's exceeded then funds dry up?

I guess that does leave the bank with an incomplete project and no firm knowledge of the total cost til completion.
I accept that Shahin clearly knows more about this and thinks it should be OK in this situation. (Though noting it was required on my PPOR build because the progress payments were not in accordance with HIA/MBA schedule; builder had to justify deviations.)

It's less about the total cost than about how much is paid versus value earned at each stage.

So they want to make sure that when 25% of value has been created, they've only paid 25%, not 30 or 35%, otherwise if the project fails at that point, the lender might be left with a shortfall.
 
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