contract language about delays
longdogwalker
last year
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What verbage is in your contract about builder delays?
Comments (31)palimpsest's experience has alway been true to a certain degree for single-family homes but is unfortunately becoming more of a problem. Details are overlooked or ignored and so is the building code since it is rarely well enforced by the local building department. Contract provisions like "liquidated damages" (for late project delivery) have always been difficult to enforce but can be used effectively on larger commercial or multi-family projects but would be virtually useless on a residential project. I would not consider using one in a residential contract but a bonus for timely completion usually works well. When thinking about punishing a contractor for slow performance consider that holding anyone responsible for events beyond their control or for losses you cannot substantiate is not something on which you want to base a claim especially in court regardless of the contract wording. There are 2 ways to assess damages for late project delivery: actual damages and liquidated damages. If the actual loss to the owner at the end of the project can be determined that should be the method used. If the damages will not be easily determined at the completion they should be "liquidated", i.e. set forth in the original contract. But be careful. If the liquidated damages provision bears no resemblance to the actual delay damages which the parties would have anticipated at contract signing, the fine will be considered a "penalty" and will therefore not be enforceable in most states. In other words, you cannot penalize your contractor for slow work; you can only demand reasonable compensation for the loss the delay caused you. Many states require proof of actual damages at the end of the project instead of allowing the contract liquidated damage amounts to be enforced. Basically, the idea that a contractor can be made to work faster to avoid fines is specious at best. This post was edited by Renovator8 on Tue, Jul 22, 14 at 10:08...See MoreReady to sign contract -- DH freaking about economy!
Comments (24)We put our pool in about six months ago and are wishing like you wouldn't believe, that we wouldn't have. I'm a realtor and my husband owns a home inspection business. We feel like we're at the very top of the economic pain chain right now. First we had Hurricane Ike and no power for two weeks, then went straight into the 24/7 news coverage about how bad our economy is. Houston weathered the original mortgage crisis really well. Our market didn't take a hit like the others did. But now, my husband hasn't gotten a call since before Hurricane Ike. That's almost a month. He never used to go more than two days. We can't tell what's hurricane related, or what's fear related right now. My work has stayed pretty much the same, because I'm in the foreclosure industry. Because of the path I've chosen, his inspection business is the bulk of our income. (He's also a career firefighter, but it'll be extremely tight living off of that.) I look in my backyard and I love what I see, but I definitely do not like the fact that I ate up a huge portion of my equity when I put it in. Worst case for us, we might very well have to sell our house in the near future, and when/if we do, we're going to take a hit that we wouldn't have taken prior to the pool. The only way I'd put one in right now, is by paying cash only. No way, no how, would I finance one and eat into my equity. And I would do neither if my job wasn't secure. Just a thought....See MoreLanguage in sales contract about inspection
Comments (19)Salti, it doesn't matter what fantasy they believe, when dealing with me. I am selling what is offered, not an ideal version of what is offered. My houses are always at least 50 years old and that is what you are getting - a 50 year old home, not a new one, I tell them. Caveat: again, this does not apply to unknown actual safety issues that are uncovered. I had one sale where there were some water heater venting issues, and they didn't even have to ask - I stated up front that I would replace the venting to the water heater as it was an unknown problem, and got a plumber right away to fix it. I'm not upgrading for the Buyer, and you cannot believe how many times I have been asked to upgrade something that is functional. It must be HGTV renovation shows that makes these buyers believe they should step into a high end mansion for their first home. It's crazy....See MoreNervous about unusual contract terms with production builder
Comments (26)The first home we built was a tract home like this...I completely understand not wanting to build this way, but I am also aware that sometimes that's the only way you can get in the area you want. That was the situation we were in at the time. I had done a complete gut/remodel/addition on a 100 yr old farm house with a local small builder and loved it...we were moving to an area where small builders weren't an option as there was no land not owned by production builders and there was NOTHING on the market that met our needs our could be rehabbed to meet our needs within the budget....so production build is what we did. I agree with everyone that the contracts are 100% in favor of the builder and it depends on the builder (I'm assuming it's really how much they get from the lender) on what they're willing to allow you to negotiate. I was able to change nothing in my contract yet my cousin building at the same time with a different builder was able to make adjustments... BUT what I will tell you in hindsight...I wouldn't do ANY upgrades. I did the ones that we thought made sense...wood flooring throughout, cabinets...the things that seemed wasteful or very intrusive to do later. I regretted it. With the flooring, we paid a ridiculous amount to upgrade to was still crappy. It was still builder grade. Same with cabinets. We would have been money ahead to build basic and add the upgrades after possession. Had I done that I would have gotten better flooring for 1/2 the price. I did rip out my counters and used the original ones in the garage. I got a higher level granite for the same price they were offering level 1. I wish I'd done that with the floors and cabinets! Just something to think about....could save you some money upfront and heartache in the end. Good luck!...See MoreJeffrey R. Grenz, General Contractor
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