Construction Process Basics Every New Home Owner Should Know

31 May Construction Process Basics Every New Home Owner Should Know

It is very important for home owners to understand the construction process. As complicated as it is to purchase an existing home, building a new home has even more unique elements. From financing to customizing to ensuring timely completion, there are many details to work out between you, the lender, and the builder. Here’s how to eliminate surprises and facilitate a smooth process.

New Construction Loans

Financing construction works a bit differently than obtaining a mortgage for an existing home. You will likely need a short-term construction loan that converts into a regular mortgage. These loans may require different sets of paperwork and qualifications, especially if you do not already own a home to use as collateral.

Get the ball rolling and speak to the builder about their normal process and contact lenders to determine what kinds of loans you will need — the earlier the better.

Understand the Builder’s Contract

Variables in a construction contract range from who will choose the paint colors to how often payments will be made. Many aspects can be negotiated to suit your budget and timeline expectations. Key components include:

• Payment structure and dates
• Incentives and penalties for early or late completion
• Allowances for hardware, fixtures, and paint choices
• Change order fees
• Add-on features, whether an attic or basement will be finished, etc.

Customize Early

Ultimately, just about every decision can be changed. Small changes might be worked in seamlessly, but larger changes — after materials have been purchased and work performed — are scarcely different than renovations. A good construction project manager will help you understand how and when to request changes, your options for requesting change orders, and whether certain changes will delay completion.

Invest in Quality and Energy Efficiency

Materials referred to as “builder-grade” are typically lower quality than what many homeowners really want. New construction is your chance to get higher-end finishes and the best energy-efficient technologies.

Thoughtful investments in quality and energy-saving features can ultimately reduce your cost of ownership. Think about the costs of upgrades over the next five, ten, and fifteen years — and consider the value of getting what you really want now, while materials are being purchased wholesale and integrated by the builder rather than costly renovations soon after.

Working Around Delays

Any honest builder will tell you that schedule changes should be expected — there are too many elements not controlled by you and the builder. That said, you do not want move-in to get delayed several months because your contractor is juggling projects and missing deadlines.

Preventing delays starts with the building plan. Specific plans must be made in regards to the lot, neighborhood requirements, material sourcing, and even the weather patterns throughout the building schedule. Your construction team should provide a dedicated project manager who oversees everything and communicates well with you.

During construction, if delays do occur, you should understand the builder’s obligations and feel like you are informed and in control. We at McNeil construction believe in building strong at lasting relationships with our clients. Contact us for more information on we can help you build the home of your dreams.