What's a draw inspection?

So, what happens with a 203k loan?  Here's a look at the numbers:

• The purchase price of the home must be in line with an "As Is" appraisal
• the total loan amount includes the purchase price and the cost of the repairs, plus 10% of the repairs
• that 10% should be factored in when considering your budget - you don't want your cost of repairs to be your desired budget.  The bank will automatically add in this 10% for unexpected repairs, so you want to be sure you can afford the mortgage payment.  If nothing unexpected does arise, this 10% is automatically applied to the principle of your loan after all the work is complete - remember, though, that won't change your monthly payment.
• Your "After Construction" appraisal must match up with or exceed your total loan amount.  The appraiser uses the 203k report to determine what repairs will be completed after closing.  In some cases, you may be able to borrow 110% of the "after construction" appraisal - but that is a dangerous thing to do - why knowingly get into a loan situation that will be upside down from the beginning?
• After closing, you have a certain period of time to complete the work.  This usually does not exceed 6 months.  In our case, we plan to have the work complete within 5-6 weeks.
• In order to pay your contractor or be reimbursed for materials, you have to have a draw inspection.  The number of these inspections varies based on the project and you are paying per draw for the consultant to come out and inspect the work and then prepare the request for the draw from the bank.  Once the bank receives the request, a check will be mailed to the contractor, but the homeowner has to sign the check as well.  This is a protection to keep contractors from collecting money for an incomplete project.  The bank also withholds 10% from each draw, to ensure the project is completed in a timely manner.  That final 10% is paid to the contractor after full completion of the project. 
• If you do not require as many draw inspections as were written into your loan, the unused fees are applied directly to your loan principle.
• Be patient.  Everyone involved is doing more paperwork than typically required, especially the contractor!
• If you were smart with your budget, which I am desperately trying to be, you will soon be in a fantastic home at a price you can comfortably afford.