Guidelines for Selecting a Builder
So you've decided that a new home is for you. Make sure you follow some guidelines to make sure you're happy with the home building process.
Select a reliable builder with a strong reputation in the area that you desire to live in. Try talking to people in the neighbourhood about their home building experience. Were they happy with how the process went? Do they feel good about the end result? When you've narrowed down which builder you think you'd like to work with, then begin working out the details.
Think through in great detail, exactly what features you would like in your new home. You will prepare a detailed agreement before building, usually referred to as "plans and specifications." It is easy to have misunderstandings if you are not very specific in this agreement.
Make sure if interest rates are low when the building process begins, that you lock into an interest rate. Do not allow any arrangement where the lender may increase the interest rate later if they go up before your home is finished.
Also, make sure there is a definite completion date stipulated in your contract. If there are any improvements or street repairs to be made in the neighbourhood, find out in advance whether you or the builder will be responsible.
Keep an eye on how your new home is progressing during the building process. If things don't seem to be going according to schedule, don't be afraid to inquire with the builder. If changes are called for that deviate from the original agreement, get a written change order agreement drawn up. This will ensure no surprises at the closing.
If all of this seems like a lot for you to keep track of, call on me for help. I can help make sure you are being represented and protected properly. An investment this large deserves special attention to detail.
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Real Estate Vocabulary
In an ongoing attempt to educate homeowners in real estate terminology, here are a few terms that you should know:
Abstract of Title: A summary of all of the previous owners or records relating to the title of a piece of land. Attorneys or title insurance companies often review an abstract of title to determine if there are any potential problems that must be cleared before title can be transferred to a new owner.
Acceleration Clause: A condition in a mortgage contract that may require the balance of the loan to become immediately due and payable, if certain terms such as regular payments are not kept.
Cloud on Title: An outstanding claim or encumbrance which affects the transfer of title to a new owner.
