A vague scope of work is how rehabs balloon 40% over budget. A tight scope is how you keep contractors honest, lenders comfortable, and projects on timeline. Here is what to include — and a template structure you can copy for your next deal.

Why Scope Matters

Your scope of work (SOW) serves three masters: your contractor, your lender, and future-you. For the contractor, it defines exactly what is being built and for how much. For the lender, it supports your bridge-loan draw schedule. For you, it is the reference document for every "is this in the budget?" conversation.

The Five Sections Every SOW Needs

1. Property Overview

Address, size (sqft, beds, baths, lot), year built, condition notes. Photos of current state. This anchors everything else.

2. Finish Level / Design Direction

What will the finished property look like? Paint scheme, flooring type, kitchen tier (builder-grade vs. mid-grade vs. custom), cabinet specs, countertop material, fixture brands. Reference inspirational photos.

3. Line-Item Scope by Room

The heart of the document. For each room: demo required; framing/structural changes; electrical (outlets, switches, fixtures, panel work); plumbing (rough-in, fixtures, drain work); HVAC (ducting, vents, units); insulation, drywall, paint; flooring (type, sqft); finish carpentry (trim, doors, hardware); room-specific items (cabinets, vanity, etc.)

4. Systems / Envelope

Roof, siding, windows, doors, foundation, major systems (HVAC, electrical panel, plumbing). Anything that touches the whole building goes here.

5. Budget Schedule

Each line item with its dollar amount. Add a 10–15% contingency line. Total must match your loan's rehab budget.

Template Structure

PROPERTY: 123 Main St, Baltimore MD
TOTAL BUDGET: $75,000
TIMELINE: 120 days

SECTION 1: DEMO         $5,000
  - Full interior demo, dumpster x2

SECTION 2: ROUGH TRADES
  Electrical             $8,500
  Plumbing               $7,200
  HVAC                   $6,800

SECTION 3: ENVELOPE
  Roof patch/repair      $3,500
  Windows (8 units)      $4,800

SECTION 4: INTERIOR
  Drywall + paint        $9,000
  Flooring (LVP, 1200sf) $6,500
  Kitchen cabinets       $5,500
  Kitchen counter        $2,800
  Appliances             $3,500
  Bath 1 full            $4,200
  Bath 2 full            $3,800

SECTION 5: FINISH
  Trim, doors, hardware  $2,500
  Punch list             $1,400

CONTINGENCY (10%)        $7,500 (in reserve)

Common Scope Mistakes

Tie Scope to Your Draw Schedule

When you submit your scope to your lender, structure line items so they align with your draw schedule. Tighter alignment means faster draw approvals and cleaner inspections.

Revisit Scope After Demo

Demo always reveals surprises — bad framing, knob-and-tube, water damage, cast iron. Build into your plan a formal scope review after demo week, with budget impact documented. Better to re-baseline honestly than pretend the number still works.

A good scope is worth 40 hours upfront to save 400 hours of mid-project pain. It is the single highest-leverage document you will create per deal.

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