Saturday, July 3, 2010

Beware of Housing Developers Who Cut Corners

As the government officials are yelling recession, we should be aware that people are financially strapped and many builders will cut corners and they will try to cut the places that you cannot see with the naked eye. You see so many developments going up all over town and they are in fast competition with the one around the corner. All of a sudden you see this bidding war going on. So what happens, the builder starts cutting corners to save money. A smart buyer is the one who is cautious and always checks on credentials and references.

Steps to find a reputable builder:

1. Choose a builder who has a long standing client base. Ask the clients if they were happy with the builder and if he completed the work on time and with good quality standards.

2. Always choose a bulider on his reputation and not on the low bids. A reputable builder will not be able to compete with the bids of those who cut corners.

3. Avoid Builders who try to offer you under the table refunds. Such as charging the insurance company more than the cost of the repairs and reimbursing you a portion. If he will try to fool around with the insurance company, he will do the same to you.

4. From the very beginning, have a set plan in mind. Do not change your mind as this will cost you more money.

5. Try to get a simple agreement with your builder, most builders will not sign a written, legal contract. But the paper you write should include:

- Price of the construction

- What date will the work start and end

- What are the deposits required

- How will the builder let you know if the cost will be more

- Is the builder licensed and properly insured
After the work is finished the builder must agree to give you a completion certificate. Hold off any final payment until that certificate is in hand.

Never, ever give a builder free will with your home and your money. Go daily and watch what is being done to your home. You need to watch the wiring, the plumbing and the insulation. A big cut that many builders are doing today is to put cheap insulation inside the walls and the roof. They will use less than up-to-code wiring and yes, you will even get a shabby pink bathtub instead of a solid steel bathtub as you requested. Take a cup of tea and go and watch what is being done to your home.

It is good to watch the builder as he meets with the city inspectors coming to check on the building permits. If the inspector is not happy with the performance, then so should you. You hear about these awful stories after the huge damage in New Orleans. People gave their life savings to these builders, only to be left with a pile of old lumber that was never even sawed. The con artist came out of the woodwork and they were only there to take and rob.

Go to the city building department and ask if this builder is reputable. Also, on new home purchases, insist on a 10 year guarantee on the property. Any builder who will not give you a ten year guarantee, do not buy that house. All homes should be in great shape for more than ten years, but that will give you some peace of mind. Keep in mind, that if this builder is not reputable, even with a guarantee, he will run.

A lot of people could be saved thousands of dollars just by checking on the builder. It is not the immediate damage that you might worry about, but the future damage, such as a leaking basement. A leaking basement is incredibly hard to repair and extremely expensive. Improper insulation will cost you hundreds of dollars in heating and cooling.

Go to the neighbors and ask for references for the builder. Neighbors love to talk. Then go to any other housing complexes he has built and look to see wear and tear on the buildings and talk to the people there also. Any reputable builder will never mind giving you several references. Look for warning signs, before you sign on the dotted line.

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