Learn me everything you know on the home building process

[SMKR]

Wife and I decided to build our first home since ours just recently sold. Can anyone here give me input on how this process works?

Do you apply and get approved for a certain amount, then find your builder/lot, etc?

Do you start making mortgage payments during the building process or after the home is finished?

Those that have built a custom home, if you could go back and do it again, what would you do differently?

Any input would be appreciated.

[fordracing19]

I just finished my second home. First we contracted ourselves and second used a builder. Our builder was horrible. Do not use Keen Homes.

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[Sean88gt]

It will stress you out, nothing planned goes according to the plans, allow for fuck ups, use a builder - Texas has some goofy regulations making it difficult for you to do your own, write down everything you loved and hated about past places and try to correct it here.

[red95gts]

Hire a third-party inpsector to inspect the home at multiple times throughout the build. You'll probably spend $1000 on this overall, but it's money well spent. Otherwise, I'd fully expect the builder to fuck shit up or at the very least - not build it with good building practices.

Home builders are like Mustang builders: the majority are complete amatuers and hacks. We built a new home last year and the builder seemed great at the beginning. Once we signed the contract, shit went downhill quickly. I would recommend finding other homes the builder has build and stop by and talk to the owners. If it's a neighborhood setting, just talk to people when they're outside. If I would have done the same, I probably wouldn't be living where I am as we speak...

[Vertnut]

A lot of people on this site don't really know what a "true custom" home is. No production builder builds a "custom home". If you have questions PM me. I'll help if I can.

[8mpg]

Wife and I decided to build our first home since ours just recently sold. Can anyone here give me input on how this process works?

Do you apply and get approved for a certain amount, then find your builder/lot, etc?

Do you start making mortgage payments during the building process or after the home is finished?

Those that have built a custom home, if you could go back and do it again, what would you do differently?

Any input would be appreciated.

You need to have an idea on how big of a house you are planning on building first. You also need to know if you want a true custom home (build on your lot) or are you going to use a builder in their neighborhood on their lot. Building on their lot is way different as the builder owns the land and will carry the construction loan and sell it to you as a mortgage. This is teh easiest.

If you are building on your own land, you need a construction loan. You will pick your own builder. You will get a construction loan (hopefully one that is a single close loan which starts as a construction loan and rolls into a mortgage).

[wishitwasasvt]

We built our house by contracting out our selves and saved $110k. If your going that route I'd suggest going through the owner builder network, all of those guys are in my opinion the best and most trust worthy you'll find.

[8mpg]

We built our house by contracting out our selves and saved $110k. If your going that route I'd suggest going through the owner builder network, all of those guys are in my opinion the best and most trust worthy you'll find.

Did you pay cash and was your house $600k? Most custom builders are in the 10-15% cost plus range

[Vertnut]

Did you pay cash and was your house $600k? Most custom builders are in the 10-15% cost plus range

Truth. I shoot for 10-12%, but if I make 10%, I'm good. My subs love to see the "Build Your Own" guys coming. A "one-shot-johnny" can allow them to make 25% more and never have to worry about warranty issues or keeping me happy. I know of several people out here in Ellis County that used them (or someone similar). A couple of them did OK and didn't lose money, but it took double the time. Most ran into scheduling issues that extended the time it took to build the house, and had cost over-runs. Most banks do 9-month interim construction loans. After that time, you will get charged another origination point to redo the loan, plus the interim interest you've already paid. On a $300k loan, we're talking some bucks. I have a house 1/2 mile from me that the owner never finished. She built a gorgeous place on 10 acre's, but couldn't pay for a 600ft long driveway and her drainage work. It sold through foreclosure process about 6 months ago after sitting empty for over a year. Once you run out of funds, you have to come out of pocket. That interim loan is based on a pre-construction appraisal, and cannot be adjusted.
In most cases, an honest builder will pay for himself over the course of the construction of the house. Me and my subs are responsible for that house for a year, and 10 years for anything structural.

Sorry for the long post, but I get these questions all the time.

[ceyko]

Sorry for the long post, but I get these questions all the time.

You should do a basic FAQ for this sub forum. I could be all jacked up since I'm not a builder, but everything you say lines up with what my dad says who is a custom home builder.

Specifically, on some of the high level basics. To me you hit the nail on the head too about custom builder vs what we see everyday on the way. They are two totally different processes. IMO the production builders make it seem so easy, but take all the options away. A custom build and going through that process is more stressful and you have to understand more and it can take awhile from a customer point of view - but it's better at the end.

Buying land, developing it, plans, tweaks, bids...etc all add up from the time/stress department. It's the only way to get what you really want though.

[Vertnut]

You should do a basic FAQ for this sub forum. I could be all jacked up since I'm not a builder, but everything you say lines up with what my dad says who is a custom home builder.

Specifically, on some of the high level basics. To me you hit the nail on the head too about custom builder vs what we see everyday on the way. They are two totally different processes. IMO the production builders make it seem so easy, but take all the options away. A custom build and going through that process is more stressful and you have to understand more and it can take awhile from a customer point of view - but it's better at the end.

Buying land, developing it, plans, tweaks, bids...etc all add up from the time/stress department. It's the only way to get what you really want though.

I always keep my home-owners as informed as they want to be, and make them a big part of the process. Once they see the complexities, I rarely have issues with them. It's a team effort, and I work FOR them. I walk them through the entire build, and am available any time. I make no bones about what I charge, and I've never had anyone begrudge me that. I have walked away from a few build-jobs because I sensed a possibility of clashing personalities or lack of trust. It's a 6-7 month "relationship", and it needs to be a good experience. They are spending the most money they ever will, and it should be an enjoyable, positive experience.

[wishitwasasvt]

Did you pay cash and was your house $600k? Most custom builders are in the 10-15% cost plus range

We took a layout we liked and tweeked it, after that we took bids from different builders and the lowest bid was 350k.the house has 3200sq ft of living space plus a two car garage.. we decided that was out of our price range and that we would possibly be better off contracting out ourselves. All said and done, four months And $240k later we have our house.. and yes we paid cash.

[GeorgeG.]

That's some pretty good savings, IMO....so when you contract out, do you mean that you just find your own subcontractors? Where do you find your subs? I would think just looking around on Craigslist is probably not a good idea.

[wishitwasasvt]

Most of the contractors I used were from the owner builder network.

[SMEGMA STENCH]

You mean just doing it yourself ? hire one contractor to lay foundation, hire one to build house/fram, one to run electrical, etc ?