What to Consider When Signing a Contract with a Home BuilderWhat to Expect from a Custom Home Building Contract
Hiring a contractor to build a custom home is a big commitment. That’s why it is especially important to know what to expect from a home building contract and to ensure that you are dealing with a reputable builder.
Signing a contract is an essential part of the home building process, as it establishes legally-binding expectations between the buyer and the builder. A home building contract ensures that both parties are on the same page before the building begins.
Because building a custom home is so personal and specific to each client, a contract should be tailored to your needs and financial situation. The document you sign must reflect the designs and expectations that you and the builder set during the initial consultation and meetings.
A home building contract should be specific and complete enough to cover all of the bases, but simple enough to be understandable. If your home builder is reputable, the contract will be transparent and there will be no hidden fees. The ideal contract employs a fixed-price bid, meaning that both parties know what the price to the buyer will be up front.
What a Home Building Contract Includes
A custom home building contract should include the following information:
- Scope of the work: materials, labor and other requirements and costs for building your home.
- Plans and specifications that show the design and layout of your home.
- Schedule: a timeframe that details when the project will be complete.
- Payment: the fixed amount that is owed by the buyer, when it is due and how it will be paid.
- Clauses accounting for potential changes to the scope of work due to unforeseen events or changes made by the buyer.
- Other legal provisions.
Your contractor should take the time to make sure that you understand the contract. A trustworthy builder will be transparent about expectations, costs and schedules.
Benefits of a Fixed-Price Contract
Fixed-price contracts establish the cost of the project before the contract is signed. Once the contract is signed, the buyer will not be charged any additional fees for work that is included within the contract.
This allows for predictability throughout the process. Buyers do not have to worry about unexpected or underestimated costs affecting what they must pay for the home. This stability allows buyers to budget more easily and keeps the process transparent.
What to Look for in a Home Builder
Before signing a contract with a custom home builder, make sure that they are licensed contractors and are insured. The best home builders are those that are experienced in your local community. Reputable, experienced home builders with a local focus are a low-risk option and build high quality houses.
Whitmire Custom Homes is an experienced home builder in North Georgia. If you are interested in building a home in one of our service areas, contact us to learn more about our home building process. Another great way to learn more about building a custom home is to schedule a free consultation.