Research Your Builder, Realtor, and Tradespeople

This Is How You Do It

If you are looking for new home, chances are you’ve had lots of well meaning folks tell you to “do your homework.” Research your builder. Check out that Realtor before you sign an agreement. Investigate your home inspector before you decide who to use.

Everybody says this, but how do you do it?
Here’s How.

First off, realize “checking out” of any professional should be commensurate with the task at hand. Spend a little more time looking into a builder who is going to construct your $250,000 house than you would checking out a plumber who is going to replace a leaky hose bib.

General Checks

  • Start with the website of the local Better Business Bureau (BBB). Some tradesman may not be members of the BBB, but the BBB will still record if they have received a recent complaint. [Not being a member of the BBB is not a negative either. To manage costs, some professionals only join one or two professional organizations.]
  • Check out the Secretary of State’s page for your state. The Secretary of State maintains a searchable database of all businesses licensed in the state. Check the company name and note the other officers in the company.
  • Next, navigate to your local court website. Once there, search all combinations of company name and company officer names.
  • Do a general Google search of the company name and officer names along with the words “complaint” and “rip-off.”
  • Run company names through Angie’s list, and also search on Reddit and City-Data for your area. Check Yelp for business profiles. Look for a profile and associated ratings on Facebook.

Research your builderSome search sites are touchy. Misspelled words or inaccurate business names do return results. For example, a builder might use “Super Duper Homes” for trade, but the legal business name could be “ABC Builders doing business as [dba] Super Duper Homes.” This kind of difference between the trade name and legal name can often be figured out via the BBB, where you can also search on phone number. Sometimes this difference also comes to light via a search on the Secretary of State’s information.

Check-out Your Realtor

Research Your Builder

  • Look to see if your area has a local Builder’s Guild. Search their databases for your service professional.House with bad tar paper job
  • Knock on the doors of the already completed houses if you are interested in a specific subdivision. Introduce yourself and mention you are thinking of buying, and ask about their experience with the builder. Usually, satisfied customers are happy to tell you so. Dissatisfied customers are even more anxious to share their story.

Plumbers, Electricians and Trades

  • Ask for tradespeople recommendations at local building stores, like plumbing, paint, flooring and roofing supply stores. Ask store staff if they have heard of who you are thinking of using.
  • Get your Realtor’s input on builders and tradesmen. Ask your tradesman for input on Realtor’s and builders. Ask any of these people for past client references. If they are a reputable outfit they won’t have any qualms with providing references.

Keep Things in Perspective

Don’t be dismayed by a few bad reviews. Everyone has an off day, and some measure of unforeseen issues is normal in every transaction. What you are looking for are more good reviews than bad. On the bad reviews, you want to see that some kind of action is attempted to fix or otherwise mitigate the issue.

The Invisible Man

What you want to avoid are ghosts, i.e., people who don’t show up anywhere. Most importantly, avoid professionals without an entry at the state professional license boards. Also, avoid professionals who have more negative reviews than good ones, or those that have a pattern of inaction and indifference.

Forewarned is forearmed!  Happy House Hunting.

New Means Better, Right?

Why You Need a Home Inspection

Twice in one week I’ve heard clients say they want new construction “because new is better.” Brand new homes come with some nice perks, but a well-maintained existing home can be every bit as good, and sometimes better. A poorly executed new build can be a never-ending nightmare, lost money and a river of tears.

Be an informed buyer whether you are buying a new to you home or newly built home. Know what you are buying. Know that there is no perfect house.

Here’s how.

Existing Homes

  • Get a home inspection. Let me say that again, get a home inspection, get a home inspection, get a home inspection! Even if you are buying a home “as-is,” get a home inspection so you know what you are getting, what works, and what doesn’t.
  • Order a consumer CLUE report. This is a Comprehensive Loss Underwriting Exchange report used to rate insurance policies. It shows if any insurance claims have been filed on the house in the last 5-7 years.
  • Knock on the neighbor’s doors. Introduce yourself, tell them you are thinking of buying the home, and ask if they know of anything of which you should be aware.

And don’t forget NEW homes.

New Homes

You need a home inspection, even (especially) on new construction. A lot of buyers don’t realize this. You can and should have your new home inspected, before closing.

Misaligned tile

Misaligned tile. Not even new homes are perfect.

When all the tradesmen and subcontractors are working to finish a new build, things get a little hectic. Wires get crossed, literally. Your home inspector will check all the mechanical systems and evaluate the physical structure.

Home inspections make sure that new appliances work; that the electric is properly grounded; that the plumbing is properly vented. Even the little things matter, like ensuring that the small Allen wrench wasn’t left in the wrong place after the garbage disposal install.

Check the Contract

Home inspections are requested (or refused) in the purchase contract.

Inspection contingencies are standard in contracts for existing homes.

Be mindful if you are using a builder’s contract for a new home. Builder contracts may be silent regarding home inspections. The builder may offer a builder walk-thru or new home orientation. No matter, home inspections are different, and all buyers are entitled to one.

The bottom line on new construction — Request that a provision for a home inspection is included in the contract.

But What about My Appraisal?

An appraisal is not a substitute for a home inspection. An appraisal is a report that lenders require to estimate the market value of a home. If you are using a special financing program like VA or FHA, the appraisal will also determine if the house meets the minimum requirements of the program. The appraisal may comment on cosmetic issues like peeling paint, or stains on ceilings.

What you need to know — Appraisal do not evaluate the physical condition of the house, identify needed repairs nor estimate the remaining useful life of systems.

Walk-Throughs – Important, but NOT an Inspection

Bad cutout for a can light - Home Inspection details

Home inspections can turn up cosmetic issues like this ragged cutout for a pot light. Don’t be afraid to ask for a fix!

A builder walk-through, (also called Pre-Settlement Walk Through and New Home Orientation), is the time when the builder acquaints you with your new home and demonstrates how stuff like the new gas fireplace works.

A builder walk-through is not a substitute for a home inspection. The builder walk-through, ideally, should happen after the home inspection, but before closing.

At the walk-through, the builder also explains warranty information and required maintenance to keep everything in good working order.

This is your chance to make sure the home is up to your quality standards, both construction wise and cosmetic, before closing.

If necessary, ask your home inspector to attend the walk-through to verify corrections.

Getting the Fix

If closing day arrives and there are still issues with your new home, you have a few options:

  • Delay closing until the issues are fixed.
  • Close, but have the closing company hold some amount of payment in escrow. When the builder fixes the issues, the closing company then releases the escrowed amount.
  • Proceed to closing and obtain a cash concession/settlement from the builder to compensate you for whatever issues remain. If you take a cash concession be aware the builder is then off the hook to make any repairs or fixes, as you have been compensated. It is up to you to then fix, repair, or live with it.

The old saying is that “knowledge is power.” That is absolutely true in real estate. Invest in a home inspection and ask questions when you are buying so you know what you are getting. New doesn’t always mean better, and existing doesn’t always mean bad. Happy House Hunting.

 

Huntsville Magazine Online

Published six times a year, NO’ALA Huntsville magazine, celebrates life in North Alabama: Huntsville, Athens and Madison.

I’m not connected in any way to this publication, but I am always excited when a new issue come out. As the magazine says of itself, it’s about– Lifestyle, Arts, Business, & Gossip of Huntsville, AL. I have lived here a long time, but I always learn something interesting about the area when I read it.

At the No’ALA Huntsville website, you can read the most recent and back issues online.

NO'ALA Huntsville MagazineThe Home and Garden Issue, Special Summer Spaces, lets readers peak into some of Huntsville’s unique and beautiful homes. Plus …

Little Libraries and Big Ideas.

Gardens – for sculpture and food.

Teaching An old dog new tricks on a cross-country move.

How to make flaky pie crusts and some sumptuous fillings to go in them.

Summer events, like  Saturday Suppers at Belle Chevre, who crafts delicious goat cheese daily.