dmccarty
Super Star Member
For our house we had line item costs and allowances in the contract. The line items with a cost did not move price wise. The allowances did as I mentioned in a previous post. We spent more than the allowances on certain items but this was all in our favor since the builder only billed up to the allowance. We paid the difference. This was to our advantage since he did not get his percentage over the allowance. For the line items in question there was no extra work for him so it was fair.
The builder submitted the bills at major project milestones which was about every month. The bill went to us and the bank. We would ok the bill to the load officer, who would cut the check which we picked up from the bank. We would then sign our part of the check and hand it over to the builder. We knew what work had been done on the house and if the bill was fair. The only way we could have been cheated is if a given line item was say $5,000 but it only costs $2,000 to complete.
But we trusted the builder and I at least some idea of costs. The bank was also checking to see if any particular line item was over priced compared to other homes in the area. There are also rules of thumbs that say the framing should be a certain percentage of the house. I had looked this up prior to signing the contract and the bank ended up making the builder fill out a worksheet that broke down costs so they could compare his prices vs other builders.
The funny thing was that the bank sent out "appraisers" to check the house at various stages of construction. I was at the house one day when the "appraiser" showed up in a convertable, stepped gingerly out on the gravel driveway with his dress shoes and silk sock, walked to the edge of the gravel and peered quickly at the foundation. The so called "appraiser" checked off some boxes on a clip board and left.
The "appraiser" did not impress me if you have not noticed. :laughing:
The only thing Mr. Silk Socks could see was the foundation walls. The house is on a slope with the down slope side of the house being about 60 inches above grade. We have a concrete slab. So the slab has to be supported and in our case the foundation is filled with 67 stone. From where Mr. Silk Socks was standing he could only see the foundation walls not inside the walls. At this point he should have been checking to see if the plumbing was installed and the gravel placed since these were big line items on the next draw. But he would have messed up his shoes if he had gotten closer to look IN the foundation walls. :laughing:
Later,
Dan
The builder submitted the bills at major project milestones which was about every month. The bill went to us and the bank. We would ok the bill to the load officer, who would cut the check which we picked up from the bank. We would then sign our part of the check and hand it over to the builder. We knew what work had been done on the house and if the bill was fair. The only way we could have been cheated is if a given line item was say $5,000 but it only costs $2,000 to complete.
But we trusted the builder and I at least some idea of costs. The bank was also checking to see if any particular line item was over priced compared to other homes in the area. There are also rules of thumbs that say the framing should be a certain percentage of the house. I had looked this up prior to signing the contract and the bank ended up making the builder fill out a worksheet that broke down costs so they could compare his prices vs other builders.
The funny thing was that the bank sent out "appraisers" to check the house at various stages of construction. I was at the house one day when the "appraiser" showed up in a convertable, stepped gingerly out on the gravel driveway with his dress shoes and silk sock, walked to the edge of the gravel and peered quickly at the foundation. The so called "appraiser" checked off some boxes on a clip board and left.
The "appraiser" did not impress me if you have not noticed. :laughing:
The only thing Mr. Silk Socks could see was the foundation walls. The house is on a slope with the down slope side of the house being about 60 inches above grade. We have a concrete slab. So the slab has to be supported and in our case the foundation is filled with 67 stone. From where Mr. Silk Socks was standing he could only see the foundation walls not inside the walls. At this point he should have been checking to see if the plumbing was installed and the gravel placed since these were big line items on the next draw.
But he would have messed up his shoes if he had gotten closer to look IN the foundation walls. :laughing:Later,
Dan
