Punch List Definition ala Wikipedia
International Residential Code (IRC) Link
So, the day you've been waiting for is finally getting closer and the renovation that turned the "project" into a more livable home is about done. The contractor approaches you for signature for the final payment-the one that will not only pay for the final phase of the renovation but which will authorize the release of the mandatory lender hold back money (usually 10%). The lender's inspector will validate the completion of the work as well, so you don't have anything to worry about. They'll catch anything that needs attention...right?
Once the contractor gets your signature, it will be extremely difficult, if not impossible, to get them to respond to a call back later. Simply put, there's no "new money" in it so it's a cost to them. To be fair, not all contractors operate this way, but in "203K land--where they know repeat business is almost non-existent and many are operating on thin profit margins to begin with (an unintended consequence of the process as encumbered by many of these specialized lenders or loan processors)--most are going to be motivated to ignore you or, at best, provide only a token response or remedy after final payment has been made. In other words "stall the call"... Know this, once the final payment has been released, you have little effective leverage other than the reputation of the contractor and their moral virtue... Good luck with that...
But, you don't know much about acceptable building practices or defects that could cause headaches down the road. After all, that's why you hired the renovation contractor in the first place! You could rely on that overworked lender inspector who is doing this job, along with quite a few others, for very little money (he/she isn't likely to see you again either after this is done)... Fortunately, there is a better way.
Getting an independent, post construction/renovation inspection is well worth the money in most cases. In our experience, there's not been a single time we've not found enough items for the punch list to more than pay for the cost of the inspection (many times over in some cases). Moreover, it's much harder for a 203K contractor to B.S. a colleague, so the chances of getting an issue addressed CORRECTLY are much better.
Remember that the local county/city inspector has signed off on major work in most cases, but they are checking for MINIMAL compliance with the IRC. Many of the recognized best practices are not included in the current version of the IRC (that's why it's routinely revised), and most of these inspectors come from offices that are routinely overworked and woefully underfunded. In short, they are unlikely to note most of these items as they might not rise to the threshold of a bonafide violation or significant material defect.
Armed with a written, detailed list of items needing attention, the homeowner can better assure that these items will get addressed BEFORE they sign off or formally accept the job as completed. This type of punch list typically gets results because both parties now know, and agree on, the final items/actions required to achieve completion for final payment. A final word of advice, make sure the inspector you hire is both a licensed home inspector and, if possible, a home improvement contractor. These guys know what to look for because they've "been there and done that" before. Pay them the nominal fee to revisit the home after the punch list items are completed (just to be sure they've been done correctly) for additional peace of mind.