Builder contracts

What You Need to Know About Builder Contracts

Building a new home can be exciting. However, the process differs from buying an existing home because you must make a deal with a builder. That means you need to learn about builder contracts.

Builder contracts outline the builder’s responsibilities and the buyer’s payment terms. A good contract will ensure the interests of both parties. This post will outline what you need to know about builder contracts.

Northern Virginia Real Estate Market Watch

The average sale price for homes in Fairfax, VA, during September 2023 was $701,500. However, real estate data is always changing. Contact Only Pay For What You Need Real Estate for help buying and selling homes in Northern Virginia.

The Basics of Home Builder Contracts

Scope of Work

The scope of work section outlines the work the builder will do. It will cover materials, labor, and other services they provide to complete the home. The contract may also have sections for inclusions (all things included in the contract’s scope of work) and exclusions (work not covered in the contract).

Pricing and Payment Schedule

This section outlines the cost of the work and the payment schedule. Most builder contracts involve a lump sum up front. The buyer then needs to provide payments as the project reaches various milestones. The contract should also outline a final payment and how long after completion it is due.

Project Timelines

Buyers and builders need to set a timeline to hold the builder accountable if the project runs long. This section will include the schedule of work and an outline of the payment milestones. However, it will also have terms concerning delays. For example, the contract should allow for delays in the event of a natural disaster.

Change Orders

The scope of work might change during the project. Maybe you changed your mind about a detail or decided to add something. It could be an issue with the local building codes. The contract should have terms that cover changes to the scope of work and you should ammend the contract to reflect the changes.

Quality Standards

The contract should define clear quality standards that the builder must meet throughout the project. These standards cover aspects like materials, workmanship, and construction techniques. It should also outline the role of inspections to ensure compliance with these quality benchmarks.

Warranties and Guarantees

Builder contacts should include warranties and guarantees. Common warranties cover workmanship, materials, and structural integrity.

A solid contract is crucial when building a home. That’s why buyers should work with a lawyer or real estate professional. They can help you understand the contract and ensure it protects your interests.

Real Estate Services Based on Your Needs

Do you need help buying or selling a home in Northern Virginia? Click here to contact Only Pay For What You Need Real Estate. We are local experts dedicated to offering high-quality service at lower prices. Reach out now to learn more about our services.

Thanks for visiting!