Step 6: How Your Home Will be Built

Communication is likely the biggest problem in construction. This is because there are so many details to decide on over such a long period of time that there are bound to be times when both parties do not recall the same conclusion to a discussion. Our Contract Documents have been designed to eliminate communication errors as much as possible. They generally include, but are not limited to, the contractual agreement, the specifications, an allowance schedule and the house plans. These documents are of the utmost importance because they are designed to protect both you and us the builder during the construction process from communication errors or things simply left unsaid. These documents spell out exactly where each responsibility lies, which materials are to be used, how much you have to spend on the items to select (allowances), and of course, how much your new home will cost. We will prepare these documents for your signature(s). We offer advance copies for your review. Take time to study the documents carefully. As we stated earlier, these documents are suppose to protect both parties involved. If you do not understand, or you have questions regarding the contract documents, ask for clarification. If you want something changed, ask us if we are willing to change the item in question.

Below is a brief description of the each of the contract documents

•Find a Professional - Take notice from the beginning of how professional, prompt and courteous each builder is with you. Ask yourself if you want to work closely with this person or company for the next several months. If the feeling is not a good one in the beginning, it probably will not improve once a contract has been signed. If you determine that a builder is not for you, use their bid price for comparison sake. Remember, always ask for references. Call some of the builder’s previous clients and ask them about their experience while building and the builder’s follow up after the construction process was completed. Having a builder that has and honors a warranty is very important. If one builder's bid price is well below the others then this should throw up a caution flag for you. Either the builder has made a mistake or needs work so badly that he is bidding low to keep cash flowing in. Either of these situations will likely cause you big problems once construction is started. In short, don’t expect five star quality and service at one star prices.

•Contractual Agreement ~ This is a document, provided by us, the builder, that states who the parties to the agreement are, describes the property in question, lists the other contract documents, and states the price and the terms under which your home will be constructed.

•Specifications ~ The specifications are prepared by us or your home designer, although we usually are the one to provide them in this area. The specifications, as the name implies, specify exactly how the home is to be built. For example, the specifications might state that exterior walls will be of 2" x 4" construction with studs at 16" on center. The specifications should be very thorough. For instance, say that your home foundation will be two feet high but the specifications do not mention the type of exterior steps to be constructed. You might be thinking brick steps but we may have figured basic wood steps. This is why you should take your time in reviewing the specifications before you sign them.

•Allowance Schedule ~ Rarely does a home owner know exactly what type of each item they want in their new home before the contract documents are signed. Because of this, we will give you an allowance to spend on the items in question. For example, a common allowance item is lighting. We will give you a figure, say $1,500, to spend on lighting. With this money you can pick out exactly which fixtures you want in your home. The allowance amount is part of the price that you and us agreed on. If you spend more than your allowance amount you will have to pay the difference. If you spend less than your allowance amount most builders will not allow you to spend the underage to offset overages on other allowances or give you a refund for the amount you spent under the allowance, nor do we. You might be wondering how the allowance amounts are set. This is done by us asking you specific questions prior to calculating the bid price. Some builders intentionally include low allowance amounts to get their bid price down. Once the contract is signed and the house is being built, he might state that he gave you the average allowance amount when in reality the allowance was not bid adequately to cover the amount of square footage under contract. This is yet another reason for choosing a builder you are comfortable with. We have a long-term approach to growing our business. We want to establish credibility with our customers from the beginning of the building process until infinity.

•Plans ~ Your plans are also part of the contract document as they show how the house is to be built, its dimensions and how it is to look upon completion.

•Selection Guide ~ In addition to the above items our company also includes a Selection Guide in the contract documents, which has a list of common upgrades and cost options. This guide is designed to help you in the process of choosing the many items that can be included in your house. It also tells you with what suppliers we have accounts, what supplier to go to for each allowance item and reminds you of what each particular item allowance is.

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