New Home Contract

[David S]

Would anyone be able to suggest a good template for a new home construction contract that deals with bank financed project issues? Most of our work is residential and light commercial remodel, and though we have done large dollar amount remodel projects, this is our first project with bank financing. I'm looking for something fairly straightforward and communicable, but with a little more structure than our typical residential contract.

Thanks in advance for any input you can give.

[parkwest]

As my lawyer says, "you can pay me now or pay me a lot, later"

Considering you are in CA, that is where I would start.

[David S]

Our lawyer suggested an AIA template. I'm thinking we can start with something like that, add our specs and arbitration clause, etc, and then run it by our lawyer again. That way we don't come to him with a blank slate. Just not sure which template to start with.

[Happy Home]

AIA docs have been a good source of info for me along the way. There are probably 5 or 6 + docs for you to purchase and review from contracts, short and long form, to payments to lien release. Review, highlight, make notes, questions on them. You'll then have boilerplate forms / docs your atty won't have to create otherwise. Give your atty a full list of the AIA docs so he can see what's avail.

Can't say which ones to start with but you'll know where your project starts and ends within the avail forms.

The bank will also have some of its own forms so run that by your atty as to how that affects the process. I believe your GC prime contract the bank will not have and will accept yours fully or with some changes. This is where your atty comes in.

[off white]

As an aside, the bank usually has a form with cost categories that may not line up with the system you're using. You should lobby hard to use your system, since that will best line up with your usual and accustomed billing system. Taking your numbers apart and reassembling them into someone else's order is fraught with potential for error and wastes your time.

Some banks are more accommodating than others, but most have been willing to work with my 26 category system since everything is well defined in the voluminous specifications and they can see how the whole job is organized.

[MrInnovater]

Alot of the posts i've read so far are quite on the mark, having been in your situation 20 years ago i struggled with how do you C.Y.A way back then, i think alot of builders including our company's contracts are always evolving to reflect changes in code and client needs, we started out years ago with so called "stock" contract forms and didn't realize how far out on a limb we were until a few years later when we were doing our 2nd commercial tenant improvement lease space build-out in haste we agreed to an AIA addendum, the famous phrase in that addendum was always "contractor must feild verify" those 4 words let's the AIA contract off the hook in alot of area's of construction, which we learned the hard way.

I"ll suggest what our business atty, said (quote) " you know your field of construction best, Write your terms and conditions as you have experienced add anything that you feel in your experience is pertinent to the job, there's no wrong way to cover what you feel is important to the health of your business, his advice and review of our year to year changes and addendum's has always served us well.