Building a Log Home? Don't make these mistakes...

Building a Log Home? Don't make theseup will require hundreds of decisions to be made.
mistakes…..Many times, those decisions need to be made quickly.
Research suggests that building a home can be oneIf the electricians are there and have a question,
of life's most stressful events. Your dream of buildingremember that they are waiting on you to make a
that perfect log home, on that perfect lot can easilydecision and likely there are other contractors
turn into a nightmare. I worked in the real estateworking on the house waiting for them to finish.
industry for over 15 years. I've seen a lot ofHolding up one decision can hold up the entire
heartbroken homeowners who realized to late thatprocess, sometimes for a good length of time. Think
their dream was crashing. Most often the disasterof the building process as a well orchestrated play.
could have been prevented if only they had doneEveryone has their part to do and many times they
their research before signing any papers. Here are acan't do it until someone else has done their part.
few mistakes that I've seen over the years that justDon't get me wrong, sometimes there are
might save you some money and a lot of time.catastrophic circumstances and stopping the building
Maybe even prevent a headache or two:process is necessary, but many times it's not. Making
1. Only work with reputable companies: From yourgood, quick decisions can be the difference between
lender to your builder, researching the companies thatyour suppliers getting their money on time or not,
you are bringing on board for your project can saveand that in itself can be catastrophic.
you money and headaches.3. Take frequent road trips:
The Lender:It's your home, and ultimately your money. Take the
Don't just assume that the bank you've always donetime to go to your building site and make frequent
business with is the one you want to borrow frominspections. It can save you a lot of heartache in the
to build your new home. Do check out their loanlong run. Check the workmanship, make sure it's
products but don't forget to apply at 2 or 3 otherwhat you expected. Check the design, is it what you
institutions. Fees can vary as much as severalagreed on? Check the details, are they what you
thousand dollars between lenders and there areasked for? Did they put in a tub and shower instead
literally hundreds of loan products out there thatof an octagon shaped garden tub? Maybe you
might meet your needs. Always check the fees onchanged your mind on the tub early in the process
the Good Faith Estimate that you receive at the timeand told your realtor or builder. Maybe you even
of application. An easy way to compare lenders is tosigned a "change order" form. There, you thought it
check the APY (Annual Percentage Yield). Every bankwas all taken care of, right? Not
is required to give that percentage to you. Basically,necessarily….It's so easy for
it's the real cost of your loan. The higher the APY,miscommunication to happen when there are many
the higher the cost of borrowing from that institution.people involved in a project, and building a home is no
The APY rate.is not the same as your note rate.exception. Take it upon yourself to double check the
Your note rate is what your payments are based on,realtor/builder. If they made a mistake it's a lot easier
the APY is the cost to you of borrowing. If you areto fix things early in the process than to wait and
thinking of being your own general contractor for thethen play the blame game. Don't wait, and don't
project, the smaller, hometown banks are usuallyassume anyone cares about your new home more
easier to work with. You are going to be in contactthan you do. Remember, it's their job, not their home.
with them regularly throughout the process so make4. Don't sign that stack of papers unless:
sure you can get in touch with them easily ie: you willDon't sign unless you understand what you are
need to submit invoices to receive draws on yoursigning, the house is completed the way you agreed
construction loan. Many banks have their ownon and there are no outstanding bills for work done
process for receiving your draw money so makeon your new home. At the closing, there will be a
sure you thoroughly understand their process andmound of paperwork for you to sign. You have the
make sure you can work with it. Working with aright to read every document, either at closing or
lender across the country might not be the bestbefore. Ask the title company to get you a copy of
thing for your money and your sanity if you're theall of your closing documents 24 hours before closing
general contractor.and then take the time to read them. Ask questions
Above all, read before you agree.before you get to the table. Sometimes it's not a
The Builder:quick thing to fix an error so the more you know
Work with a reputable builder that you can readilybefore closing, the easier it will be. This is your loan
get in contact with. Here are a few good questionsthat you will be paying on for a long time, make sure
to ask before you agree: Do they have an after houryou understand your responsibilities. I'm a big
emergency number? Do they carry builder's riskadvocate for not signing before the house is done. A
insurance? Do their subcontractors clean up the trashnew home will always have a "call back" list. Little
daily? Do they have a good reputation? Does thethings here or there that need touched up. However,
price seem too good to be true? If it does, itif there is something major that's not done, or
probably is. Builders now days can build huge homessomething major that's not done to your satisfaction,
for less money. They advertise "more square feetyou should think about calling a lawyer. Once you sign
for your money". Sounds great, right? Not necessarily.those papers it can become a battle trying to get
Can you put a waterbed on the second floor?something corrected by the builder. Remember, they
This is a true story. A friend of mine built one ofhave their money and other homes to build. Until you
those "more square feet for your money" homes.sign and they have their money, it will be easier to
Sure, it was big and it looked nice but…theget their attention. 5. When problems arise:
studs were 24" on center and not the standard 16",If you don't already have a lawyer, get one (some
no waterbeds allowed, the walls were not finishedstates require it). Sure, your realtor, builder and lender
smoothly, and EVERYTHING was an upgrade. Sheall want to make sure the process goes smoothly
ended up paying more for a "huge" home than sheand will do what they can to make sure that
should have because the builder "forced" her to workhappens. After all, they are all getting paid once you
with their lender who, after qualifying her knewsign those papers. However, if things are not going
exactly how much they could charge her andwell, the best way to make sure your interests are
ultimately that's what she ended up paying. They'rebeing looked after is to get a lawyer. Find a lawyer
staff was very well trained.that specializes in real estate transactions. They will
Make sure you know who you are dealing withget things worked out in a way that protects your
before you sign and make sure you know exactlyinterest. It may cost you a few hundred dollars but it
what you are getting for your money.will be well worth it. Sometimes you can't put a price
2. Make solid decisions in a timely manner:on peace of mind.
As you can imagine, building a home from the ground