|Relationship Building with the Pros
What happens when your building project runs into trouble—and how do you deal with your builder? A longtime construction veteran weighs in.
1. What are the top three things I can do to prevent a relationship with my builder or general contractor from getting ugly?
Start by recognizing that this is a business relationship. Friendly and informal dealings with your builder are nice, but you’re going to be transferring a lot of your hard-earned money to him. In return, he should provide you the home promised in your agreement.
Treating your project as a business transaction will establish a professional tone and let your builder know what to expect. First, check out your builder before making a commitment. Ask for the names of previous clients, and visit their homes. Study quality (especially in trouble spots such as flooring, windows and trim), and ask each homeowner about his or her experience working with the builder. Find out whether the house was completed on time and within budget. Ask how the builder handled change requests and whether there were any surprises relating to the workmanship, materials used or construction costs. (If a prospective builder says he can’t provide client contact information for privacy reasons, don’t accept this answer. You’re spending too much money to make such a commitment blindly.)
Second, be sure your project is based on a complete, detailed building contract. Complete contract documents reference your blueprints and specifications, making them part of the agreement. In addition, the contract should clearly state the price and how payments will be made. The contract also should explain the procedure for making changes, as well as warranty terms and steps to address warranty issues.
In addition to floor plans, elevations, foundation and structural drawings, the blueprints included in your agreement should have construction details showing how floors, walls, roofs, stairs, railings and other elements of your home should be constructed. These allow the builder to estimate time and materials accurately. Without them, you may find that you and your builder have very different ideas of how elements, such as stairs and railings, should look or what the quality of materials should be.
It’s best to accompany the blueprints with detailed specifications. Written specs can run from 15 to 30 pages and provide thorough explanations of the materials you want included in your home—right down to the doorknobs. Architects usually provide specifications as part of their fee. There also are a number of books available that outline sample specifications.
Insist that your builder provide you with signed lien releases from each of the subcontractors before issuing checks. For example, suppose your contract calls for a payment, or “draw,” on construction funds when the foundation is complete and again when framing is complete. Insist on signed lien waivers from each subcontractor who worked on your foundation. This assures you that outstanding bills have been paid. If your project involves a lender, it will insist on lien waivers and inspections by its own inspector before issuing checks.
Finally, you or your representative should have final approval for issuing payments. Your lender will have its own inspection requirements, but it won’t be looking at your project with the same eye. Make sure the builder cannot go directly to the bank for payment without your approval.
2. What should I do if I’m not satisfied with some work that’s being done?
If your construction documents are complete, the procedure for handling workmanship should be straightforward. Approach the builder, and explain your dissatisfaction. Ask him to make corrections so you can make the next payment. A simple request without threats is usually sufficient.
Often, issues between homeowners and builders arise out of miscommunication. For example, if your blueprint details aren’t thorough, the builder may handle a part of construction using materials and methods he’s used elsewhere. Although these materials may be sufficient to meet building-code requirements, they may not be what you had in mind. In such cases, it’s fair to share some of the cost of changing the work to meet your expectations.
When you confront a builder about construction issues, be polite and always give him a chance to explain. Homeowners inexperienced with construction sometimes see work in progress and think they’re seeing the end result. Too many challenges or complaints can make a builder nervous. He may begin to expect clarifications before each phase of construction, and the result will be a slower construction pace and increased tensions.
3. How do I remedy shoddy subcontractor work?
Because your agreement is with your general contractor or builder, you should address your concerns with him. Point out problems as soon as you notice them—and tell him that you won’t issue payment for the work unless changes are made. Your general contractor or builder can then confront the sub and work out a resolution.
4. What if the builder disagrees with me about the shoddy work that either he or the subcontractors are doing? What recourse do I have?
You hold the checkbook, so your acceptance should be a requirement for issuing a payment. Use your construction documents for support when disagreements come up. If the matter isn’t clear from the construction documents, you may have to negotiate a resolution. If the issue is large enough, you may want to involve a home inspector, architect or independent authority.
As with all of your dealings with your builder, your best defense is a good offense. Discuss how such disagreements should be handled before they occur. If possible, include the procedure in your contract documents. This makes it a simple matter of referring to the agreed-upon procedure.
5. What should I do if my builder abandons my project?
When a builder disappears, the biggest danger is that he owes money to the subcontractors who have worked on your project. Most states have mechanic’s lien laws, which make you, the party for whom the work was done, responsible for payment. It’s heartbreaking to discover that some or all of the payments you’ve made to the builder haven’t paid the subcontractors, and now you’re holding thousands of dollars in bills without the funds to cover them.
Try to contact your builder as soon as you suspect he’s walked off. Find out what has prompted his action, and look for a resolution. If you can’t resolve the problems, find out if any subs or suppliers remain unpaid.
During construction, obtain contact information from each subcontractor working on your project. Ask your builder to provide this information, or you can obtain business cards when the subs are on your building site. (Their vehicle signs usually provide this information, too.) Contact subs immediately to see if they have outstanding invoices on your project.
Contact an attorney as soon as you suspect your builder may have vanished. Most attorneys will take a cautious approach and offer suggestions to resolve the situation short of a court battle, but it’s important to know your options.
Have a backup builder in mind even before starting construction. As part of your builder search, you should have uncovered several acceptable candidates. In the event of an emergency, one of these could become your primary builder.
6. What happens if I discover problems with the house after moving in?
Your construction contract should include a detailed explanation of your warranty, including a warranty period and a procedure for addressing warranty issues. Most states impose specific warranty conditions on builders and contractors, although terms vary.
Typically, you should provide your builder a written description of the problem with a request to have it resolved. Follow up with a phone call to the builder. If no action is taken after a reasonable period, notify him again via registered mail. This provides a record that you attempted to resolve the issue. If the builder still fails to acknowledge the issue, contact the state or county licensing authority for proper procedures.
The business end of a homebuilding project doesn’t carry the excitement of designing and decorating your masterpiece. However, it’s just as important and, in the end, may be the key to ensuring that you get to realize a long-held dream.