building new house, unexpected costs??

[03ozwhip]

i dont know if this is the right spot to put this, but need some advice from people and to see if any of you have been in this situation. i did post in a real estate part as well but didnt create a thread...anyways...

ive got a question, i just got a call from our builder saying they just went over the FINAL blueprints before they start to dig. now im not sure if all builders do it, but within the pricing they figure you *may* need to use extra materials so they log a budget in the pricing for that....no big deal its 1000 bucks.

now, my problem is, we signed at a certain price, the deal is done, they have our money. now they said theyll need another 5100 more because of the lot were on, they need to build it 4 yes a whole 4 sqf bigger.

the chick weve been dealing with said she saw this happen to alot of other buyers through them lately and she has tried to get the costs lowered by eliminating some materials ie: taking the stone 5 foot portion of the garage and make it 4 ft etc.

she got the price from 5100 down to 2100 for us but im not sure what she has cut out ill know tomorrow, anyways how is this legal? weve settled on a price a long time ago, theyve had our money for more than a month and now they need to build more and it will cost more? wtf do i say to this broad when i talk to her that can get this shit waived? sorry for the longer post but its a bit of a situation, hopefully someone can shed some light on this for me....

[JordanLotoski]

Whos the builder?

[cet]

I have built 2 houses and never had that happen to me. We picked out the lot then chose a house to go on it. We made some changes to the plans and then price was negotiated. We signed he contract with that price. Ive never had a builder come back to me saying they wanted more money to build the house bigger after the contract was signed. That kind of thing should be figured out before a contract is in place. The only things I have paid extra for are upgrades or changes I have initiated.
Does your contract having anything in it saying that extra costs may be added if the house is not big enough for the lot? I would go over your contract thoroughly and see what it says. If there is nothing in there explaining extra costs you could try to explain that you have a contract for that house on that lot and you expect them to honor it.

Who are you building with so I know who to avoid?

[88CRX]

Doesn't sound very legitimate.

Make a stink and tell them you want the exact reason why they had to build bigger.

Also if the contract specifies the house (size) and lot location then they should have figured it out and adjusted the cost prior to signing the contract.

All home builders will try their best to push you around and squeeze every penny out of you. Make a stink and tell them you're not paying it. Or tell them you want free upgrades for that amount.

[UndrgroundRider]

Originally posted by 03ozwhip
i dont know if this is the right spot to put this, but need some advice from people and to see if any of you have been in this situation. i did post in a real estate part as well but didnt create a thread...anyways...

ive got a question, i just got a call from our builder saying they just went over the FINAL blueprints before they start to dig. now im not sure if all builders do it, but within the pricing they figure you *may* need to use extra materials so they log a budget in the pricing for that....no big deal its 1000 bucks.

now, my problem is, we signed at a certain price, the deal is done, they have our money. now they said theyll need another 5100 more because of the lot were on, they need to build it 4 yes a whole 4 sqf bigger.

the chick weve been dealing with said she saw this happen to alot of other buyers through them lately and she has tried to get the costs lowered by eliminating some materials ie: taking the stone 5 foot portion of the garage and make it 4 ft etc.

she got the price from 5100 down to 2100 for us but im not sure what she has cut out ill know tomorrow, anyways how is this legal? weve settled on a price a long time ago, theyve had our money for more than a month and now they need to build more and it will cost more? wtf do i say to this broad when i talk to her that can get this shit waived? sorry for the longer post but its a bit of a situation, hopefully someone can shed some light on this for me....

Are you sure it was the purchase contract you signed? My builder had me sign lots of things, just so there was no confusion about exterior colours, floor plan, etc.

My builder figured everything out beforehand. If you've already signed then how can they ask for more money? You have a contract.

[03ozwhip]

ya the contract is signed, i dont think it said anything ni there about extra labor costs or anything. the builder is lifestyle homes. weve signed a ton of shit and theyve taken 90k of our money out of the bank already, its been finalized for a month already.

im going in for a meeting with her today and ill stand my ground and see what happens. i didnt think they could do anything like that. they had already factored in costs with moving the house over a tad because of the lot but that was it. i dont know what the fuck is going on....

edit: also the house we bought has very specific specs, 2146 sqf+ a developed basement at another 762 sqf its all been signed off....i dont know if the size that we signed off on makes a difference///

[frozenrice]

I'm not saying 100% for sure in your case, but a lot of times these unexpected costs arise from architectural controls set by the developer. The typical process involves the builder selling a customer a house based on a stock plan. If the builder has done their homework, they'll do the best they can to make sure that as much of the architectural controls are taken care of before a contract is signed by the customer. However, the submitted plans are still subject to review by the developer. Once in a while you'll get someone reviewing the plans that is having shitty day or going on a power trip that makes the builder do a bunch of changes that add to the cost of the house. The builder is often caught between a rock and a hard place because the developer won't review/approve a set of plans until a deposit to purchase the lot has been made by the builder. Essentially the builder has to committ to buy the lot before the developer will look at it. Once they developer reviews it, they are pretty much forced to do whatever changes the developer wants since the builder is stuck with the lot at this point. The builder has no choice but to go back to the customer to reclaim the additional costs.

From the sounds of it, the sales person you're dealing with is trying their best to help you out by trying to reduce the cost as best as possible. That's a very fortunate thing you've got going. Some builders/sales reps don't give a rat's ass and rape you on the extra charges (more profit margin for the builder = more commission).

[Weapon_R]

Originally posted by 03ozwhip
ya the contract is signed, i dont think it said anything ni there about extra labor costs or anything. the builder is lifestyle homes. weve signed a ton of shit and theyve taken 90k of our money out of the bank already, its been finalized for a month already.

im going in for a meeting with her today and ill stand my ground and see what happens. i didnt think they could do anything like that. they had already factored in costs with moving the house over a tad because of the lot but that was it. i dont know what the fuck is going on....

edit: also the house we bought has very specific specs, 2146 sqf+ a developed basement at another 762 sqf its all been signed off....i dont know if the size that we signed off on makes a difference///

Make sure you review your contract before you decide to make a huge fuss. In some cases, there is a clause that allows them to charge a small fee in these cases. When I signed with cardel I think there was a clause that allowed for an add'l $1000 to be taken in the event that unexpected costs arise.

If your contract does not have this same clause, stand your ground and refuse to pay. Give them the option of eating the cost or returning your money and nothing else. You simply have to tell her that you have a signed contract and any additional terms or additions are a breach of that contract.

[03ozwhip]

Originally posted by frozenrice
I'm not saying 100% for sure in your case, but a lot of times these unexpected costs arise from architectural controls set by the developer. The typical process involves the builder selling a customer a house based on a stock plan. If the builder has done their homework, they'll do the best they can to make sure that as much of the architectural controls are taken care of before a contract is signed by the customer. However, the submitted plans are still subject to review by the developer. Once in a while you'll get someone reviewing the plans that is having shitty day or going on a power trip that makes the builder do a bunch of changes that add to the cost of the house. The builder is often caught between a rock and a hard place because the developer won't review/approve a set of plans until a deposit to purchase the lot has been made by the builder. Essentially the builder has to committ to buy the lot before the developer will look at it. Once they developer reviews it, they are pretty much forced to do whatever changes the developer wants since the builder is stuck with the lot at this point. The builder has no choice but to go back to the customer to reclaim the additional costs.

From the sounds of it, the sales person you're dealing with is trying their best to help you out by trying to reduce the cost as best as possible. That's a very fortunate thing you've got going. Some builders/sales reps don't give a rat's ass and rape you on the extra charges (more profit margin for the builder = more commission).

that is definitely what is sounds like to me. ya the sales rep is a good chick for sure and im sure she hates to bring this type of shit up. i dont wanna lose out on this house though because they priced it wrong in the first place and i got a SMOKING deal on it.

also, weapon_R the 1000 clause is there and she said its very rare that it even comes to that amount and they usually give a cheque back, so we were kind of expecting that, but 5100 extra?

wtf could be that much more? it make me feel like the money that we saved by their mistake is coming back to bite us in the ass so they can try to reclaim the loss they took on the house.

[Weapon_R]

What does the clause say exactly? Is it a set amount that they are allowed to charge?

[03ozwhip]

im not sure. im leaving now to go have the conversation so ill let you guys know what happened/....

[bignerd]

Some builders were adding clauses in a while ago (when it was taking almost 2 years to build a house during the boom) to cover the cost of increasing prices on materials and labour-you had to sign off on it or they would not build the house and it was up to 10% of the purchase price. Lots of people got screwed on that one.

Not sure if they are still doing this now but I am sure you would of remembered if you signed something similar.

[InRich]

I've had this happen on my new home with Cardel, which I take over on feb 11th. Something about the lot needing more cement or something. They wanted an additional 200. I told them to kick rocks. They called me next week and told me I needed an attitude adjustment or something. I was like wow, ok... anyways this happened about 2 months after signing the contracts. They brought it back up a couple weeks ago again, months after our initial conversation. I told them about the contract, and that I own a very large business in calgary aswell, and if in my business I fucked up a quote, or I was off, I'd be the one paying outta pocket, and that I would NEVER go back to my customer and ask them for more moeny. Its not good business I said. I told them the best I could do was split it, cause she almost started crying by this time in the conversation. never heard back. dunno if they accepted it.

[03ozwhip]

ok so i did end up paying some money. initially the house was a little too small for the lot and they had to move the garage over to compensate for the big space which i agreed to as it means a bigger garage to me as well.

so, it turns out that my sales rep fucked up and didnt realize this would incurr extra costs all over the house because technically moving over the garage makes everything else a bit bigger.

i could have cut out our veranda and saved 1k but that was a big selling feature for us and it stayed. bit the bullet and ended up paying 1800 out of pocket with no more costs coming to us. i even said before i left that if any more charges( she assured me there wasnt going to be) then she would pay for them herself.

she seems pretty confident because she said she would lol anyways in the end, they fucked up by not telling us about this but it is possible that it can happen to anyone building.