how to ace the escrow process

Working with escrow can be a headache if you’re disorganized.

Here’s how to make it smooth and drama-free.

This guide was built in partnership with the AIA. 


It was fact-checked by licensed professionals and building experts. 


Consult a builder or architect for specifics to your situation.

1.

Be Organized From Day One

Inside these handy Recovery Folders we created for you, you’ll find a folder called “REBUILD ESCROW.”

Inside, you’ll find subfolders for:

  • Contractor Documents – signed contract, W-9, insurance, license proof

  • Draw Requests – invoices, receipts, photos, inspection reports

  • Permits & Inspections – permit copies, approval letters, certificates

  • Lender Communication – emails, notes, uploaded forms

  • Payments & Releases – draw confirmations, lien waivers, checks issued

What To Do:

  1. Save everything to this same folder.

  2. Name files clearly, like: 

Draw2_FoundationInspection_Approved_10-25-25.pdf

Your lender will love you for it, and it can speed up reviews.

2.

Align Your Builder’s Payment Schedule With the Lender’s Draws

Most lenders pull 4 to 6 draws (foundation, framing, MEP rough-ins, drywall, completion).

Your builder might have 8-10 phases. That’s fine, just merge them so they line up.

If you don’t, your contractor may ask for funds before the lender can release them, which can cause tension and delays.

Ask both sides:

“Can we review and align your draw schedules before construction begins so everyone’s working from the same milestones?”

This one step prevents 90% of payment issues.

3.

Keep All Communication in Writing

Always confirm draw requests, inspections, and approvals by email. That paper trail protects you if there’s ever a question about timing, quality, or missing documents. This might feel pedantic, but god forbid something should go wrong, this method can be the difference between a simple resolution and many hours of extra work. 

Example:

“Hi [Escrow Officer], Draw 2 was completed today (foundation poured). Attaching photos, permit inspection, and contractor invoice for review. Please confirm receipt and estimated release timeline.”

Pro Tip:

Create one email thread per draw so nothing gets lost.

4.

Know What Your Lender Needs Before Each Draw

Every lender’s checklist is slightly different, but most require:

  • A signed draw request form (often provided by them)

  • Photos or inspection reports verifying progress

  • Contractor’s invoice with clear phase labeling

  • Lien waiver for previous draw (signed by contractor)

  • Permit approval or inspection sign-off if applicable

TIP

Ask for the checklist in writing early. If you submit complete packets, funds release faster.

5.

Plan Ahead for Inspections

Most lenders use a third-party inspector before releasing funds.

These visits usually happen within 2–3 business days of your request — but scheduling can back up after disasters.

TIP

As soon as a phase is 90% done, email your lender to schedule the inspection. That way the clock starts early.

6.

Track Every Dollar

Keep a running spreadsheet (you have a template in your “CONSTRUCTION” Google Drive Folder) that shows:

  • Draw #

  • Date requested and released

  • Amount requested vs. approved

  • What it covered

  • Remaining balance

Why It Matters

Your builder, lender, and insurance adjuster are all using their own ledgers. Yours is the only one that ensures they all stay aligned.

7.

don’t let delays languish

If a draw is taking too long, don’t assume it’s lost in the system.

Follow up every 2–3 business days until you get a written update.

Example email:

“Hi [Escrow Officer], just following up on Draw #4. All documents were submitted on [date], and inspection was approved on [date]. Could you confirm release timing?”

Professional persistence gets results faster than frustration.

8.

keep the tone collaborative

Your escrow officer, inspector, and contractor are all part of your rebuild team.

If you’re polite, organized, and proactive, they’ll prioritize your file.

It sounds simple, but mutual respect moves money faster than anything else.

The bottom line

The escrow process can feel bureaucratic, but treat it like bookkeeping for one of the most expensive things you’ll ever do. Be methodical & precise, and future-you will thank you.

Pro Tip

If you ever have to appeal an insurance or SBA decision, your escrow record will be one of the strongest pieces of evidence you have.