8 ways to check up on your builder
Never blindly accept any homebuilder without doing a little research. It will take quite a bit of legwork, but likely will stave off potential frustration and massive repair bills. Here’s where to start.
In a marketplace fraught with the possibility of new-home defects, consumers must carefully scrutinize builders and, if possible, actively participate in the building process. Here are top resources for researching a builder.
1. National Association of Home Builders. This industry advocate organization's research center trains and certifies building professionals in its National Housing Quality program, which emphasizes "building it right the first time" instead of wasting time and money having problems pointed out in inspections, says spokesman Jeff Taggart. Participating companies use a documented quality-management system and are audited by NAHB experts. About 400 building-trades contractors and 40 builders have been certified. Find them with an NHQ certified trade contractors search. But don’t stop there.
2. Government records. See your county courthouse for any lawsuits or liens naming a builder you’re considering working with. Check all locales where the builder does business. Check with the state — each does this differently — to learn if the builder is licensed, insured and bonded. Begin with your state government's Web site or call the state office of consumer protection or attorney general (the Association of Attorneys General's Web site has links to every state and U.S. territory) and ask for help checking a construction professional's license.
3. Background checks. Search for complaints at the Better Business Bureau (no charge); look for customer recommendations at sites such as Angie's List and ServiceMagic; and run a background check on the builder with Experian's ContractorCheck ($12.95 a report or $9.95 a month). Also, ask a builder for at least one bank reference and check it, says Charlie Scott of Woodland, O'Brien & Scott, which surveys customer satisfaction for builders. "In today's environment, more important than awards is financial health," he says. (Editor’s note: ServiceMagic is an MSN Real Estate partner.)
4. Consumer complaint sites. Find articles, discussions and community at sites staffed by volunteers who have had their own problems. Here are a few:
- HOBB (Homeowners for Better Building);
- HADD (Homeowners Against Deficient Dwellings);
- Exposing New Homebuilders (a blog)
5. Previous customers. Geoff Graham, president and founder of GuildQuality, which surveys customer satisfaction for about 600 builders in North America, urges consumers to get an "exhaustive" reference list from each builder and call as many names as you can. A big builder should provide names of the last 50 people who bought homes, he says. Also, drop in on any community you're considering buying into and just knock on doors, asking homeowners who have lived there awhile about their experience. While you're at it, check the finish on home exteriors in the development. Is it the same quality as the models?
6. Model home tours and sales presentations. Scrutinize the quality with which the model homes have been finished. After you've heard the sales pitch, ask to meet with the construction supervisor. Ask lots of questions, even if you know the answers, to judge the builder's openness and responsiveness. Look for builders who want to share information and educate consumers. Ask:
- to see results of customer satisfaction surveys;
- about warranty coverage, including service, policies and procedures in the event of problems. What's the response time for getting things fixed?
- to demonstrate exactly what is meant by any claims of meeting quality standards above the minimum required by code.
- to inspect another unit (when buying a spec home) in the development or in another development by the same builder before drywall is installed. Does the rough construction look well done? Is the job site clean, neat and safe?
- to guarantee that you'll be allowed to visit your construction site. Get the procedure for making and resolving complaints. Get it all in writing, including the name of the contractor's representative who is responsible.
7. Reserve studies. When buying into a development with a homeowners or condominium owners association, ask to see this report, which is made by an outside expert. Some states require them, others do not. Reserve studies show the condition of the community's commonly owned property and whether the association has sufficient funds in its reserve account to cover upcoming expenses such as reroofing, repaving and repairs. If there's no reserve study, take extra care in examining the association's financial records.
8. Inspectors. Hire your own inspector to thoroughly examine any building you're buying, even if the seller has provided one. (Cost: roughly $300.) Not all inspectors are equal. Ask friends and colleagues for referrals and look for membership in a professional inspection organization. (The biggest are InterNACHI, the International Association of Certified Home Inspectors — locate an InterNACHI inspector here or at the group's North American Directory of Inspectors — and the American Society of Home Inspectors — find an ASHI-certified inspector here.) (Read more on how to find a good inspector.)
There are three things you should use when choosing a builder. 1-Price. A reputable builder, one that has been in business for a number of years knows pricing and profit-both important. 2-Quality-no two people can agree on what constitutes quality, it is in the eye of the beholder. Good looks is not good quality. 3- and the most important-TRUST. If you trust your builder after doing your investigation of his work and reputation, the other two factors mean little, they will be there. If you buy based upon price, you loose. If you buy based upon quality-you may not get what you want or find things important missing that you don't see. If, however you enter the relationship with a builder based upon trust, you win. The builder will work for you and your requests and desires. Trust must be earned with honesty not smoke and mirrors. Do your due diligence and work from trust, and you should have a pleasant experience.