When It Comes Down to Money

The final weeks of building a house are hell. I say this for many reasons.

As the home builders we were anticipating move-in date and just wanted everything to be done and us be in and settled. It gets really hard to wait weeks and days when you can see the end in sight.

The contractor gets to the end and is ready to move on to their next project. Don't get me wrong, our builder gave our home 110% until the final day, but they have a plan for how the last pieces should fall into place and they get just as upset as we did when things were delayed for one reason or another.

The touchiest subject at the end of the building process is money. Your bank approves your budget at the very beginning of your building process. What they approve is what you have and that is all. Toward the end every change or decision will be followed with the home builder asking for an update on the budget. Everyone's goal is to come in on or under budget.

Your bank also approves your draws. Each time the contractor asks for money from the bank, the bank sends an appraiser to come to the house and decide how much percentage of each item on your itemized budget have been completed. Based on that appraisal, the bank then writes a check for that amount (pending home builder approval) to the contractor. Following me?

Well... when it comes down to the very end, the appraiser tells the bank that the home is 100% complete. This is where things get sticky. As the home builder, you know your house appears 100% complete to the bank, but you and your builder know that their is still a punch list that must be completed. Your builder will want the full amount from the bank. As the home builder, however, you need to decide what you feel comfortable giving the builder for work completed. As the home builder, you also decide if you hold any money until the final punch list is complete. For us, we held 10% of our budget until CO was received. We then held a final $5K until punch list is/was completed.

KNOW YOUR RIGHTS. This is your home. You have final say in everything as it is YOUR money the bank and the contractor are using. Your banker will/should coach you through these ginormous decisions. Consult your family and friends in the field if you feel you need to, as well. We did.

Before you sign a contract with your builder, read the entire contract and see what is stated about final draws and amount withheld for CO and final punch list completion.

Things become walking on egg shells at the end in regard to money. I felt like the bitch in the process... but now I am happy with our decisions and glad we did what we did. Follow your gut. Do what feels right, fair, and just to you.

It's not about trust. We never lost trust in our builder. Never. It's about rights. Money is the only thing you can withhold from your contract to ensure job completion.