Is it rude to ask builder to disclose costs/profit?
CallMeJane
11 years ago
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rrah
11 years agoLuAnn_in_PA
11 years agoRelated Discussions
the house appraised for 8000 less than what the builder is asking
Comments (10)There are a few different issues here. The first is that you and the builder have arrived at different bottom lines. You need to sit down with him and find out where the discrepancy lies...I have a feeling it is probably the sq. ft. discounting as you mentioned that it is "about 5000." You need to agree on what the actual price of the house is...ask to see receipts/change orders/documentation. At this moment, who owns the house? Is it you or your builder? If it is you, he may be willing to negotiate (even if his numbers are correct)just to be finished with the job and to be able to move on. The second issue is the low appraisal. I'm sure that this happens regularly; however, I have never seen it in my area with new construction. We had, on paper, an appraisal that was $50K more than our contract price...the bank congratulated us on a good negotiation with our builder. I have the same question as the above poster...does your contract address this issue about appraisal? What are comps for new construction in your neighborhood? Price per sq ft? Try to determine if your home falls within these parameters. If it seems out of line, ask for a second appraisal. But, if it doesn't appraise then you're on the hook for the difference. Isn't your husband an attorney? (mine is too...I empathized with your stories about his billable hours. Mine billed 2400 last year...brutal!)Maybe he can do some high level negotiating with the builder? I'm blown away by the price of your home. The pictures that you've shared are so pretty...it looks very nice. There is nothing new being built in my area for anything near that price. I don't think I can remember seeing anything (in a neighborhood where you don't have to worry about being shot)in a new subdivision for less than $350K + in the past year!...See MoreBuilder asking for money a year after move-in
Comments (7)Check your state's M&M lien laws but I'm pretty certain that no state allows a contractor or subcontractor to file an M&M lien more than a year after doing the work or supplying the materials. And you say it has been 18 months since the millwork was ordered. Your bank also probably required your builder to sign an "all bills paid" affidavit before it would allow you to close on your mortgage. Thus, there is no way your builder or the millwork sub can collect this bill from you. Even if the bill is totally legitimate - which I would question - it is either the millwork sub's error (for not timely submitting his bill) or BOTH your builder and the millwork sub's error (your builder for not paying the bill when submitted and the millwork sub for not noticing he hadn't been timely paid and reminding the builder of the deficiency much sooner. How on earth could the millwork sub possibly not notice that he still had an unpaid invoice for 18 months???? The builder and millwork sub need to work it out between the two of them. If you agree to pay this bill, or even some portion of it, what is to stop your builder from showing up 6 months from now with a bill from the electrician and saying, "oops, I forgot to pay this one too." When would it stop? I disagree with jeannie01 only because, even if you are shown all the paperwork supporting that $7500 of millwork and millwork labor went into your home, without reviewing ALL the books of either the builder or the millwork sub, you have no way of KNOWING that there is not a corresponding entry somewhere showing that the millwork sub was paid $7500 for that millwork and labor. They SAY there isn't but you don't know and can't know that they're telling the truth. The whole reason for the "all bills paid affidavit" and time limits on filing M7M liens is that homeowners don't get to see all the bills and payment receipts for materials and labor that go into their homes. You would never be able to rest easy if a builder or sub could show up at any time with a bill and say "this never got paid, you owe it."...See MoreWhat is a fair profit for a pool builder in NY/NJ?
Comments (10)swimin2012, scott hit the nail on the head. When we put in our pool we got several quotes, however we did not go with the cheapeast or the most expensive one. We ended up going with a family owned and operated local company. It is all about relationships and comfort level. He showed up at our house on 4th of july and listened to us, actually walked our property. The wife gave him a drawing of what she wanted. He did not have fancy computers, 2d/3d drawings, and wore shorts and a t-shirt. We felt very comfortable with him. He then directed us to 2 other pools to look at which he built. He only asked us for 1k to pull permit and the rest of the draw after things were performed. We liked him so much we started inviting him to some of our parties and functions. To this day I can call him and he answers promptly, no voicemail etc. BTW he sends over potential clients to look at our pool. Maybe I paid too much or too little. I am very happy with our finished product 3 years later. The whole point of this is who cares how much profit someone makes, as long as you feel comfortable and feels that he brings value to the table. Hope this helps. Here is a link that might be useful: Our pool build in Jacksonville...See MoreBuilder Appliance Upgrade costs
Comments (25)I edited my previous post because I don't want to continue bumping this thread while derailing it into a financial discussion, but I do want to clear this up so I will bump one more time. Debt is a tool and when used responsibly it can construct wealth, however, when used recklessly it can destroy wealth, a "wealth hammer" so to speak. When it comes to money, many of our assumptions are simply incorrect. The life of the things you are paying for shouldn't be considered, it doesn't differ based on how you pay, so it is not relevant (actually it is the very definition of an irrelevant cost). In the end, you should look at the utility reduction of $48 per month (assuming no mortgage interest deduction) versus the utility reduction of $10,000 today. This means at minimum you should reduce the $48 per month by inflation to get to purchasing power. When we do that, without investing a single penny we find that the cost is about 20 cents per dollar borrowed. Investing the money will probably give you a payback greater than inflation, but you don't need 10%. In fact, investing the money at 0.65% (less than half of current money market rates) arguably makes financing the better option and gives you financial flexibility. As for being a math person, you can't get the proper results until you frame the problem correctly. As an accountant a lot of what I do is making sure that all the inputs are correct, anyone can do the outputs. ------------- In the end, if a little more debt makes you uncomfortable then please don't get more debt. However, just because debt is a four letter word doesn't mean it is a bad word. In the end, the more cash you have available to address life's myriad of problems, the better off you are, so I tend to value having $10,000, even if it is just sitting in the bank, more than I value a $48 payment. Good luck with whatever you decide. ------------ ETA: Depending on your tax bracket and deduction situation you might be better off donating the builder's standard appliances before moving in and purchasing new ones....See MoreCallMeJane
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