Home Buying in 55369>Question Details

Blue, Home Buyer in 55435

Working with a builder - Need help from a realtor

Asked by Blue, 55435 Mon Jul 9, 2012

I made the mistake of talking to a builder directly and now negotiating the cost & options by myself. One of the realtors I worked with suggested that builders have set pricing and no negotiations.

I am actually negotiating to include few more upgrades for the set price. Here are my questions about the process,

1. The house is not constructed yet and builder is not promising a date. Is this practice by usual? Do most builders not promise a date?
2. What should i watch out for in the purchase agreement?
3. I am expected to pay 3% earnest money, will this check be cashed the moment i sign the purchase agreement?
4. How to verify that the builder has done everything thats promised in the agreement?

It would be very helpful if someone can clarify these. If anyone is interested in helping me out in this process, i will gladly include you as my realtor in all future negotiations. I have confirmed with the builder that i can add my realtor if needed.

Thanks

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Answers

6
Donald James’ answer
Hi Blue,
Good questions and yes you need someone on your side (actually a Realtor and an inspector). Most builders have a time line and can estimate a finishing date (except for acts of God or circumstances beyond their control). The national builders I worked with have it down to the delivery week.

The purchase agreement is the contract. You must be absolutely sure everything is included and spelled out in the P.A. including target dates. It also should spell out how changes are to be handled once construction starts.

The earnest money check will be cashed and must be held in an interest-bearing escrow account.

The Inspector will verify construction as it progresses and provide you with reports.

Many aspects of this deal are negotiable. Most builders have packages for options. Many builders have finance options as well. For example, one national builder will include the finished basement package if you finance through them.

Our fees are paid by the seller. I recommend you talk to several Realtors and pick someone who has experience negotiating deals like this. Would you like to meet for coffee and discuss?
1 vote Thank Flag Link Mon Jul 9, 2012
Yea I have to agree with Rick on this one. Negotiating the transaction, and overall protecting you, is a big topic. If you already are interested working with a realtor now would be the time to get them involved. Once you sign the purchase agreement we can't step in, and it will just get sticky with the builder.

So I don't know what you mean by future negotiations, because you should want the Realtor at the beginning of them. That way they draft up the right purchase agreement for you. Please remember the builder really does not care about your bottom line they care about their bottom line. A realtor goes to bat for YOU!

If you are confused about this topic I would suggest contacting one of us directly to get it figured out, because a builder should not tell you that "it is ok to add a realtor whenever if needed"

I don't work Osseo, but I know someone who does and is good with new construction. If you would like a referral to a top agent in that area, or just discuss this topic with me further contact me directly from Trulia.

Good Luck!

Chris 651-307-7663
1 vote Thank Flag Link Mon Jul 9, 2012
Hello!
My name is Jason Lange and I am a realtor with RE/MAX Results. Please call me at your earliest convenience. I'd be more than happy to help and anwer your questions. Talk soon!

Warmest Regards,

Jason T. Lange
Realtor / CDPE (Certified Distressed Property Expert)
Licensed in MN / WI
612-247-7593 |Jason.lange@results.net |
RE/MAX Results
Web Reference: http://www.langehomes.net
1 vote Thank Flag Link Mon Jul 9, 2012
Blue,

Most builders will give general completion dates due to situations outside their control (weather, etc). What to watch out for in the purchase agreement is way too open to answer in this forum, but feel free to call...the earnest money is generally cashed within a few days of the agreement, and regular inspections and a final inspection will help you to know that the builder has performed as promised.

Call me for more help! 952-451-2900
1 vote Thank Flag Link Mon Jul 9, 2012
1) Yes there are many steps for builder to follow. They will not give you a firm date until pre-sheet rock inspection.
2) This can not be answered by email.
3) yes builder will deposit the check within 3 days.
4 By buyers inspection and experienced eyes of a realtor.
call me 763-537-8382 Any time.
0 votes Thank Flag Link Mon Dec 24, 2012
Blue,
Many of these factors will vary between builders and general contractors. However, having the experience and assistance of a Realtor should definitely help your negotiation and give you more peace of mind that you'll get what you pay for. As for the purchase agreement, there are many variables that can be swayed in the seller's favor without the proper knowledge of what the legal verbage and terms represent. I would need to learn more about the specifics of your desires, but I would certainly be willing to work with you.
Earnest money is required to be deposited in a trust account after the final acceptance of your purchase agreement. It will then be applied to your purchase at the time of closing. In regards to your satisfaction with the agreement, I firmly believe that a quality builder should allow you to be involved with the project throughout the construction. In addition to that, I would definitely recommend hiring an inspector to be involved to ensure that the builder is up to par for quality and quantity on their end of the deal. If you would like to consult with me any further, feel free to contact me at your convenience!

763-242-3242
shaynn@arthurgrantrealty.com
Web Reference: http://spdrealestate.com/
0 votes Thank Flag Link Mon Jul 9, 2012
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