Are builder's warranties worth anything ? (for sale, how much, attorney)

[jacob]

If there are major problems like foundation and roofing/plumbing issues, then if the builder doesn't fix these problems, what recourse does the owner have ?

I have heard that the builder's contract protects him completely.

So if you are stuck in a house where there are issues, what do you do ?
You won't ever be able to sell that house either ?

How frequently do such things happen ?

[Rakin]

Those are all good questions but hard to answer. There are very good builders out there who do fabulous warranty work & the shoddy ones do shoddy warranty work. That is one of the biggest factors in separating builders.

You can always file a lawsuit but in their contracts it discusses arbitration if there is a dispute, be sure and read about their arbitration.

Main think is before you hook up with a builder ask a lot of questions and get good & bad input from people who have dealt with them.

One thing I've found.... the longer the builder contract, the worse the builder. Good builders have short contracts(In general). The worst builder I know, his contract runs 19 pages. Purely protects him cause he needs it.

To answer your question... they are worth the paper they're written on.

[momof2dfw]

Originally Posted by jacob

If there are major problems like foundation and roofing/plumbing issues, then if the builder doesn't fix these problems, what recourse does the owner have ?

I have heard that the builder's contract protects him completely.

So if you are stuck in a house where there are issues, what do you do ?
You won't ever be able to sell that house either ?

How frequently do such things happen ?

Been there, done that (our MAIN one involved the foundation and we also had to deal w/ a major plumbing leak due to shoddy workmanship). Here is what I've experienced as have others that I've since met.

First off you will have to go thru the builders "proper procedures" for reporting any problems. They will come out and "inspect" first w/in a few days. In the case of a plumbing leak this does not cut it. I had to PHYSICALLY go to the builders model and get the constructin manager to come to my house RIGHT THEN! He did not want to still. If I had not all of our furniture would have been ruined as well as all of the carpet. Much more than what was ruined and they still did not want to replace the muddy carpet that was ruined.

Second. When they DO any "repairs" it will mostly be band-aid fixes. This is not all builders by any means just those that don't want to REALLY stand behind their work and still want a good rep. Most homebuyers are not that knowledgable when it comes to many things related to major problems or ones that are minor but can become major over time if not properly corrected. So the builder comes out quickly and "fixes" the problem. Unbeknownst to the owner years later when they have other problems it could very well be corelated to the first problem but goes undetected for many years. Well past the time for the builder to be responsible. In the case of our plumbing leak they stood there in the house and said they ordered the new carpet. Two weeks later they stopped returning our calls. When someone higher up showed up after I made a stink he came in and wanted to cut out sections and replace those in a high traffic area. Um, NO!!! It took us getting ugly with them to finally realize we were NOT going to settle for less (we are talking a brand new home we had only been in for 3 months when this happened). With the foundation issue they sent out several of their "experts". There were problems but they did not want to cover it. We are talking all of about $8K to fix it PROPERLY and they wanted to skirt around it and say it was our fault. Hmm, how exactly would that be??? I do know the proper care of a foundation in North Texas and follow it to a t. They did not realize that. Neither did they realize I was listening to their "expert" engineer when he was making his report. Nor did they realize I happened to be sitting in the next booth at a dining establishment later in the day when they were discussing my case. LOL!!! They KNEW it had problems they were responsible for and were trying to find a way to get out of it. And they can and do.

Third. Just about every builder has arbitration in their contract. The state board for resolutions is made up of home builders. Very rarely have they sided for the buyer. When they do the ruling is often not headed by the builder that is found liable. You do not get to pick the arbitration firm to handle your case either. The builder does.

Fourth. It takes a LOT and I mean a LOT of time to deal with problems that arise. Most people don't even bother as it costs time and money. We did and it did cost us a lot of time and money. We had to change attorney's twice and finally got one that was worth anything and was able to negotiate a settlement. When we accepted the settlement for us to fix the foundation as they were NOT going to do it at all it voided the entire builders warranty. Well, they are worthless to anyone who really knows so that was no big deal. We had to disclose EVERYTHING and we did when we put it up for sale. We did not hold one thing back. We actually got a great price for it as we had started out much lower just to sell it but got some really crappy offers. Raised the price and sold it w/in a week. We offered the money or to fix it for the buyer. Our buyer wanted us to fix it and they also wanted us to use who they wanted. No, I'll pick who fixes it as I still own it and foundations are vital. I did not want them to pick some fly by night company do a shoddy job and they walk from the sale. If they lost their job the day off closing and I still had the house at least I knew the company that did the work was trustworthy. The buyers could have taken the money, picked their own company and had the work done after closing and they would have had money left over. Oh well.

[jacob]

So I should not really buy a new home then ?

Or not buy a house at all ?

[jacob]

momof2,

When you say you lost money on the house, how much are you talking about ?
10k ? 50k ? 100k ?

Who was this builder ?

I am sure Grand Homes is the bottom of everybody's list.
What about Meritage Homes ?

Is it safer to buy old homes because you already know about all these items during inspection ?

[momof2dfw]

Originally Posted by jacob

momof2,

When you say you lost money on the house, how much are you talking about ?
We first listed for about $20K less than we paid for it 6 years earlier. We raised it well over that and got a full price contract and it appraised w/ everything but we had fixed the problems.

10k ? 50k ? 100k ?
We came out a wee bit ahead actually but that is because of the floorplan was very desireable, the extra large lot and the extras we had done during build and afterwards.

Who was this builder ?
Centex.

I am sure Grand Homes is the bottom of everybody's list.
Grand rates lower, MUCH LOWER than Centex. I would not give them the time of day to even waste time looking at their models for ideas.

What about Meritage Homes ?
Don't know much about them. They are fairly new to this area and only build in areas not real close to me.

Is it safer to buy old homes because you already know about all these items during inspection ?
I'd buy in an area after driving around that has already finished at least 1-2 phases and see how well people are keeping up their houses and yards. If it looks like crap, not much done to it since they moved in then I'd keep on driving. Being the first in an area is not always the best since you don't know how people are going to take care of their property.

You could still buy a fairly new home in a newer area and be fine. Just drive around check out the upkeep, get your inspections, get an engineer to check the foundation, etc. Then maintain it properly yourself after purchase.

We still bought a new home after that last one but at a higher price point and from a much better builder. I'd still build a new home today but I'm VERY picky and I've got experience in construction (education wise, work experience and personal experience). We are getting ready to build on ourselves w/ a custom home builder. But they are very over cautious of what they are doing as we have been picky about it ourselves. It is practically going to be OVER engineered.

Yes, I'd run from Grand Homes as they do NOT have the best rep at all around here and their neighborhoods tend to go down in appeal for resale.

[MurphyPl1]

Our Sotherby warranty work was actually pretty good. To be honest we had very little work that needed to be done in that first year after we closed. I believe that had a lot to do with the quality of the builder, the fact that we were welcomed onsite during the build and were able to catch potential problems early on. Also we had a fairly extensive punch list that we made them go thru prior to close. They'll try and get you to sign off that they can complete XYZ after the close so that they can hit their sales #s. Don't do it. Make them correct any problems before you own the house so they have that incentive to get it done.

[angram73]

I think you should always look into the complaints with the company. There are bad company's and there are good. Either way, sometimes it is nearly impossible to please everyone all the time. But their are really good builders that try. Do research. Google the builders you are thinking about. There are always going to be pros and cons to pre existing verse new. New homes are alot more energy efficeint now than they use to be. So if utility costs affect your decision at all I would look into that as well.

[TXRyan23]

I manage a construction company in Tennessee, You'd be supprised how many warranties turn out to be not worth the paper they're written on.

[charlessims22]

We built a Centex home 4 years ago and was the worst mistake we ever made. AC was undersized and never worked. That cost 7K and centex would not help out. Be careful who you use for a builder and stay away from Centex homes.