BuildingInTX
Junior Member
What is the name of your state? Texas
After hearing several glowing references (one from a friend) we chose to build a home with this particular builder. We met with a designer and developed a floor plan, negotiated a contract, the owner of this company received the same plans we had and bid the job. We agreed on a price after a little haggling, and we all signed the plans and the contract. We were told it was OK to close on our construction loan and did so ($6500 in closing costs), then they took the first draw, $38 k, near the end of April. We soon met with the foundation/framing guy and he noticed some problems with the plans (roofline issues, the set did not show the correct lot slope, etc.). The next day the builder called and said they fired our designer; he was new to them and all 4 plans he was working on for them underestimated the square footage. Ours was 360 sq. feet more than we all thought! (The market appraiser caught this and we even ASKED the designer why the appraisal footage # was so much more; he said "they must be including patios".) The builder also said the roof wouldn't work as-is and said they were very sorry, they'd "make it right", and although they wouldn't build the house at a loss, we would be getting a lot more house than we thought. They gave our plans to a real architect this time who offered some suggestions to re-work the plan and shave off square footage in the way of hallways. We said we'd entertain his ideas and we ended up liking them better than the first plan. We took off almost 250 square feet of total space and felt we were doing the builder a favor by meeting them more than halfway, being under no obligation to do so. Now they say they are "re-pricing the new plan" and just told us they plan to discount $10 k off the new pricing for us, which still leaves us about $15 k over what is already a stretch for us. We can't afford that, and would also be out $6500 in closing costs from the bank, right?
Our contract says "Builder may change the price prior to commencement of construction, but if Owner does not agree then Owner may void the contract without penalty or further obligation". Once the contract is signed, the Builder may not cancel it unless we don't pay.
They already have our first draw. We're already paying interest. They have not cleared the lot yet. Does this count as "commencement of construction" since they have already been paid to start? They aren't making as much as they were at first, but they aren't building it at a loss, either! It's not our fault the builder didn't re-check the footage before bidding the plans.
Thanks for your time and advice. I'd like to know what to counter with at our next meeting.What is the name of your state?
After hearing several glowing references (one from a friend) we chose to build a home with this particular builder. We met with a designer and developed a floor plan, negotiated a contract, the owner of this company received the same plans we had and bid the job. We agreed on a price after a little haggling, and we all signed the plans and the contract. We were told it was OK to close on our construction loan and did so ($6500 in closing costs), then they took the first draw, $38 k, near the end of April. We soon met with the foundation/framing guy and he noticed some problems with the plans (roofline issues, the set did not show the correct lot slope, etc.). The next day the builder called and said they fired our designer; he was new to them and all 4 plans he was working on for them underestimated the square footage. Ours was 360 sq. feet more than we all thought! (The market appraiser caught this and we even ASKED the designer why the appraisal footage # was so much more; he said "they must be including patios".) The builder also said the roof wouldn't work as-is and said they were very sorry, they'd "make it right", and although they wouldn't build the house at a loss, we would be getting a lot more house than we thought. They gave our plans to a real architect this time who offered some suggestions to re-work the plan and shave off square footage in the way of hallways. We said we'd entertain his ideas and we ended up liking them better than the first plan. We took off almost 250 square feet of total space and felt we were doing the builder a favor by meeting them more than halfway, being under no obligation to do so. Now they say they are "re-pricing the new plan" and just told us they plan to discount $10 k off the new pricing for us, which still leaves us about $15 k over what is already a stretch for us. We can't afford that, and would also be out $6500 in closing costs from the bank, right?
Our contract says "Builder may change the price prior to commencement of construction, but if Owner does not agree then Owner may void the contract without penalty or further obligation". Once the contract is signed, the Builder may not cancel it unless we don't pay.
They already have our first draw. We're already paying interest. They have not cleared the lot yet. Does this count as "commencement of construction" since they have already been paid to start? They aren't making as much as they were at first, but they aren't building it at a loss, either! It's not our fault the builder didn't re-check the footage before bidding the plans.
Thanks for your time and advice. I'd like to know what to counter with at our next meeting.What is the name of your state?
