What verbage is in your contract about builder delays?
farmhousegirl
9 years ago
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9 years agoRelated Discussions
Has anyone broke their contract with their builder midstream
Comments (21)houses14 - Why did we hire him? Because the ONE thing he turned out to be very good at was talking a good game! He comes across as the nicest guy you would ever want to meet. I called all the references he gave us. Then I found out later that one of the three references was his GIRL FRIEND! Another admitted to me later that the only reason he agreed to give a reference was in order to get the builder to finally come fix punch list items that he'd been waiting over 2 years for! The 3rd was actually a satisfied customer...at the time he gave the reference. But by the time we started doing discovery in my law suit, that customer too was pissed off at builder because he had started having some problems with his house due to some of the shoddy building practices builder had employed. We also talked to a couple of builder's subs before hiring him. Later on we found out that builder had owed them large sums of money and had flat out told them that the only way he'd be able to pay them was if he managed to land another job... so it was in their financial interests to tell me they'd never had any issues with him! When we started having issues ( the second week of the build!), according to builder, the problems were always due to a "misunderstanding" because I had somehow not made myself clear. Builder always promised that HE would make everything right b/c he just wanted me to be happy. Despite problem after problem after problem - none of which ever seemed to actually get resolved to my satisfaction - I continued to believe for quite a while that he wanted to build me the home of my dreams and would eventually do so. It was only after he very clearly lied to me on two separate occasions where there was absolutely no possibility of a misunderstanding that I started insisting that every single communication between us be in writing. Even when we met and talked about something, I started carrying my computer with me and IMMEDIATELY sitting down and writing up exactly what we had agreed to, emailing him a copy to his smart phone and demanding that he read it and sign it if he agreed with it OR that he respond with a revision stating his own understanding before we went any further. That's when it became more and more difficult for him to get me to agree to sign off on additional draws when the work that he claimed was completed really was NOT. Once I was dried up the spigot of easy money, we started getting liens filed against our house by subs and material men. Then builder started claiming that he had more money tied up in our house than we had paid to him - although he could not seem to tell me exactly how much. I told him that if he could show me with DOCUMENTS (receipts and canceled checks) where he had paid out more than he had been given, I would reimburse him every penny of the overage. When he started sending me documents to back up his claim, I called the materialmen and subs and went thru every receipt with a fine tooth comb. Turned out he was sending me bogus documents... eg., receipts for materials that were never put into our house; lien releases from subs who told me that either the signature on the lien release was NOT theirs or that they had signed the release in exchange for a payment check that then bounced so that the release was not valid, and so forth! Builder was only able to reasonably document an amount equal to about 60% of what we'd paid to him in draws...which means that he apparently pocketed close to 40% of the $290K we paid to him. That's over $100K in "profits" taken out UP FRONT on a $540K build that was less than half complete at the time we fired him. Yet he claimed we OWED him money! In answer to your next question about why the builder is not in jail, I talked to the local district attorney about a criminal prosecution for fraud. The DA told me that he had TRIED to bring a criminal case against my builder previously due to the claims of another previous client of his and had failed. According to the DA, builder and his attorney convinced the grand jury that the only thing going on was a contract dispute so it belonged in civil court not criminal court. You should now that Builder is a local boy, son of one of the wealthiest citizens in the area, a deacon in the local church, and - as I said earlier - a very smooth talker. Like us, his previous client who sought to have him prosecuted was a newcomer to the area. Having failed once, the DA was not willing to attempt to prosecute him again. Thus my only option was to go thru the civil court system. And before I could complete that process, builder passed all his assets to his father who put everything into a spendthrift trust leaving builder "judgment proof". Then builder declared bankruptcy....See MoreDid You Talk To An Attorney About Builder's Contract
Comments (15)I agree with engaging a lawyer, but know you will have to decide how hard you want to push on changes. Some are more important than others, so depending on your ties to the builder you will need to make some tradeoffs of risk vs contract terms ... keeping in mind you are at the start of a 9-12 mo "relationship". Everyone will draw a different line. If you are truly willing to walk away then you can push harder on issues that in reality you hope won't ever become issues anyway. One suggestion ... I was able to get my builder to electronically provide his base contract wording to me in MS Word. Electronic version made it much easier for my lawyer to "mark-up" his changes. Once changes were done, I reviewed them with him to understand the reason for each change and the potential risk ... whereby I made the decision to keep or drop them. The lawyer was very helpful to guide me on which ones to "fight" for and which to simply "try for" ... In my case, I got most of my critical points and many of the "try for's", but the arbitration issue is VERY hard to get dropped with most builders in my area. At best I was able to improve the wording and lenghten my warranty coverage....See MoreNew Build - Questions for Builder Before We Sign a Contract
Comments (133)@Rai Kai … I did learn so much!! Thanks for your contributions! @Beckysharp haha. I will be doing more research with the lawyer. I think overall my realtor was good—but I am not sure if overall we were the right fit. We will see if we stick with her. I know she put a lot of work and time into it --- so I do feel bad about us not going through with it. I will be doing more research and googling, and reading and using all my resources! Promise! @PitrateFoxy – I’ll probably be doing some research on a lawyer to have “on call” when we are at that point. You all were so right about all the other things – and I’m sure a few extra hundred bux (what like 500? ) will put me more at ease as I don’t like surprises unless they flowers, chocolate, or kisses :D @bellburgmaggie – isn’t that the truth. Alos.. Houzz app isn’t going anywhere! I love your story about finidng the right place! Man.. 3.5x your investment!! AWESOME!!! Were you ever concerned about over improving? That’s my biggest fear, especially if we buy very low… You know I always imagined buying the house with the crappy wall paper, shag carpet and pink or green tile in the bathrooms a horrible kitchen and then putting in my DREAM kitchen (or as im learning from houzzers, my 99% dream kitchen!). I think that’s something I was struggling with buying new. Even though I got to make a few selections… it wasn’t tailored to me really. So asking my husband in 3 years to redo the layout of the kitchen wasn’t going to fly :D Location location location is so hard for us. We are transplants – with family in the area, but are having a hard time finding the “right” home town. Everywhere we look is “safe” but I really want that neighborhood feel. I moved to Texas because I love saying yes sir, no ma’am, and I want to raise my kids like that. Sweet tea on the porch and waving to your neighbors. I want to make meals for new moms, or help out my grandparents when they need it. I may not have the Texas accent, and as the saying goes “I wasn’t born in Texas, but I got here as soon as I could!” @jannicone – I’m not deleting Houzz!! Just Realtor, Trulia and Zillow :D It may only last a week, but I need some distance! But I will use it as a resorce to keep an eye on the market and see what really happens during “selling” season. Happy to be sorta liked! @Denita , I should know better. I’m a firm believer that EVERYTHING is negotiable and if you aren’t willing to make any changes (they may not have lost me if they let me go to the design center and let me have 2 extra days – would have cost them nothing) I’m not inclined to play ball. Especially in an industry where negotiation is nearly expected. Looks like I have some more homework and research to do! I may need to find a new realtor. Not that she wasn’t good. I felt like she was doing a good job – but I’ll never know if she asked the builder for things. She did make us feel like her only clients, and she was very attentive and listened to my concerns. But I did get a slight feeling that she was “building” up the home a little more than she should have. We signed a contract for 6 months with her. She led with “if at any time you are done with me, I’ll just rip it up.” Who knows if that will come back to bite me in the butt. But, also thought we were going to end up with the first house and it would all be over. Again, lack of experience on my part. I've done some research on how you should select a buyers agent... and I did kind of do it all wrong....See MoreDelaying Contract and now asking more money before contract is signed!
Comments (17)"Can I sue builder just because of a clause which said they had to sign the contract within 10 days and now asking for more money." Yes, you can sue the builder and for the low low price of $50,000 in attorney fees and a few years wasted, you could possibly get $30,000 discount on the home price. In the American system, each party pays their own attorney fees. Judges and contracts can change that but you really need to read the contract as a change could just as likely mean your paying the builder's attorney fees as his paying yours. "My assumption is it would not be easy for them to ask for price rise if they would have signed the agreement with me." Many contracts will have a clause that limits the builder's responsibility for things he can't control. So I would be mildly surprised if your assumption is correct. Lumber prices are up 21% in the last 7 days and 49% in the last month. I suspect the builder would have the right to increase your house price anyway and may have the right to increase it again. Furthermore, I am not sure the lot hold isn't cancellable by the builder. If your builder has the right to cancel the agreement then it is practically worthless. ETA: a lot hold is a contract unless it can be cancelled....See Morecaben15
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