What to Know About New Construction Contracts in Illinois

 Posted on January 21, 2021 in DuPage County Business Law Attorney

Buying a house is likely the biggest purchase you will make in your lifetime, next to purchasing a business or company. Depending on your wish list and budget, you may consider an older home or new construction. Besides being brand-new, one of the benefits of new construction is getting to pick out all the appliances, tile, flooring, fixtures, and more. However, it is also important to understand the legal details of your construction contract to make sure your rights are protected and you are not taken advantage of as a new homeowner. An experienced real estate attorney can guide you through this major endeavor so you can build the house of your dreams.

Reading the Fine Print

New residential construction contracts are legal documents that typically have been prepared by the builder. They will include many details of the agreement between the builder and the buyer, such as tax information, blueprints and specifications, warranties covering materials and workmanship, zoning ordinances, closing date, and more.

Giving a builder earnest money can be risky. If the builder files bankruptcy, disappears, or closes the business altogether, that money is most likely gone. Therefore, it is recommended that any earnest money is minimal. It is best to deposit the money with a third-party escrowee.

Before signing a contract for your new construction home, it is imperative that you read through the fine print. Here are a few helpful tips to protect yourself:

• Do not agree to price escalators if the builder fails to start or complete the structure within a designated time period
• Do not agree to pay a penalty for failing to close
• Do not agree to release the builder from liability for their negligence
• Do not sign a contract that does not have mutual remedies if a party defaults

It is also critical that you do some research before hiring a contractor. Talk to friends or family members who have had new houses constructed before. The majority of home builders are honest and reputable, but there can be some who are not as trustworthy. Time spent investigating can prove invaluable, and a knowledgeable real estate attorney can help you with this important step.

Contact a Wheaton, IL Real Estate Lawyer

Buying new construction can be exciting and nerve-wracking at the same time, since you want to ensure your rights are protected during the process. At Stock, Carlson & Duff, LLC, we understand the complex nature of real estate law, including new construction contracts. Our skilled DuPage County real estates attorneys represent buyers and sellers at closings in both residential and commercial real estate transactions. We have successfully resolved disputes involving boundary lines, encroachments, easement, and survey issues. Call us today at 630-665-2500 to schedule a confidential consultation.

Source:
https://www.newhomesource.com/learn/understanding-your-new-home-sales-contract/