1. Read the builder contract thoroughly. Some builders have their own sales force and will require buyers to use their internal contract form. Such contracts are ALWAYS written in the builder’s favor. Read IT and get explanations for anything you don’t understand. Look for any stipulations with which you disagree.
2. Make certain your purchase offer includes everything you want. Everything of importance must be written in the contract. Verbal promises from the builder’s representative are not binding. While the builder’s agent may not knowingly attempt to deceive you, the builder’s obligation is to meet only those terms and conditions that are written in the contract.
3. Ask for a copy of the builder’s warranty. If the builder has a written warranty, read it. Understand what is covered and what may be excluded. Be careful of builders who have no formal warranty or who defer to their state guidelines which, in many cases, may be vague and difficult to enforce on minor issues.
4. Understand the amenities package. If the community includes an amenity package—pool, tennis court, playground, etc.—make certain you understand how the facilities are to be maintained. Is the builder still involved in the process? Is there a possibility of future assessments to homeowners when the builder is no longer involved? If the facility isn’t complete is there a written commitment for completion? Is the builder financially sound so that completion will not be delayed or cancelled?
5. Who is to hold the earnest money? Some builders specify that they will hold the deposit or earnest money. Be careful, for this clause is specifically designed to keep you from cancelling the contract should something go wrong with the process. Builders who are unwilling to allow a Realtor® or other third party to hold the earnest money do so to maintain control and can use it as leverage if problems arise. If there is a disagreement or if such builders declare bankruptcy, the money may be lost. I recommend having a third party hold the funds.
6. Understand the closing. Make certain you fully understand the options for scheduling your closing. Can the builder force you to close earlier than you wish if the house is completed ahead of schedule? Does the contract specify that closing must take place upon the issuance of a certificate of occupancy by the local building authority? If so, you could be forced to close sooner than you wish, in some cases prior to the completion of the punch list. Can the builder delay closing—perhaps causing you to lose your preferred interest rate—without penalty? Read this section of the documents and understand what is specified.
The bottom line on purchasing from any seller is to understand all the documents you sign, to make certain that everything is in writing, and to get clarification of anything that is unclear. Home buyers who recruit a qualified and experienced Realtor® will have an additional safeguard to insure that their interests are protected. Click HERE for more great tips on buying from a builder.
The Housing Guru: The one source for all your housing questions


While those in the northeast may disagree, with many areas still white from a season of record-breaking snowfall, spring is only three weeks away. It’s not too early to get out the tool box and start planning your home’s seasonal maintenance. Developing a routine of home maintenance will keep it functioning more efficiently, prolong the life of equipment and appliances, and make your home safer and more comfortable. A schedule of regular maintenance will also save you money by helping you avoid expensive repairs.
reasons why I don't anticipate a return the glory days of the past decade; and while most seemed to understand my purpose for writing the post, some suggested that I should refrain from such "gloom and doom" projections.
Recent conflicting reports about the housing market and whether or not it is truly in recovery have left consumers as well as those in the real estate business more than a bit confused; those whose business plan is dependent upon a full or quick recovery should proceed with caution. I believe the housing market is far from recovered, and, in fact, will not return to the levels of the past decade for many years—if ever. I see six reasons why the housing market peaks can not return, that it will never regain its past “glory days.”
Following its most recent meeting, the Federal Open Market Committee (FOMC) has issued a statement of its projections about the economy, but instead of “sugar coating” or garbling the message, let’s call it like it is—it’s not a recovery. Chairman Bernanke had already warned us to expect a “jobless recovery,” but exactly what is that? Isn’t that just another way of saying, no recovery? Those without jobs or who are bringing home smaller paychecks or whose employment remains precarious, would have difficulty agreeing that their financial picture is recovering.
With all the news about the declines in residential real estate, I thought it would be good to remember that home values have remained unchanged, and, in fact, haven’t changed in decades. In the midst of a recession, and with real estate prices plummeting across the country, how can that be?
There seems to be a lot of confusion among consumers regarding credit scores, credit reports, where to get them, which ones are accurate, and how to access your credit report and score without getting scammed. With the economy in the doldrums and with mortgage lenders and credit card issuers having tightened lending guidelines, awareness of credit status is more important to consumers than ever. And the numbers of companies offering “free” credit reports along with credit protection services has grown dramatically within the past few years.