full image - Repost: Closed and got the keys on a new home (new construction) here's some things I learned (from Reddit.com, Closed and got the keys on a new home (new construction) here's some things I learned)
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After months of back and forth, I finally closed and got the keys on a new home (new construction) here's some things I learned. This applies to the builder I used, who I can't publicly name due to my sales contract explicitly saying that I am not allowed to say anything negative about them. However, from my research this is all standard experience with the big builders. I'm talking about the builders that specialize in first-time and step-up home market, not custom homes. So think: Pulte, Lennar, Dream Finder Homes, DR Horton, Centex, etc...1.) There is a builders cartel of sorts. I'm loosely using the word "cartel", they collaborate to control the market in ways that is advantageous to all builders/sellers. That is to say, all the "big builders" who fall under this umbrella unify on contract terms like forcing arbitration, buy back clauses, etc... Also warranty terms, etc...2.) The builder often owns outright or has a partnership with the warranty work contractors, especially plumbing, AC and electrical. I found the names of all the companies we have to use for warranty service and researched them, they all exist only to do warranty work for these builders. The AC company (which also installed our unit) is not even an authorized Lennox AC dealer. This is how they control cost, but you also get horrible service according to the numerous reviews.3.) Builder has a deep partnership with Lender. This one more common knowledge, but what might not be known is how the builders can manipulate you. Builder might have multiple choice lenders to work with, usually 2-4. The first one they recommend will probably give you the worst deal in terms of interest rate and may tag on extra points (money that goes right into both the lender and builders pockets, should you take the bait), if you push back and refuse to use lender #1, builder can offer up lender #2 which will give you a better deal in order to save the sale.4.) Lender has inspectors and appraisers they sometimes employ other times contract, but this deep network includes fudgery when needed. For example, we had some known issues the electricity in the home would have to be on in order to be discovered, well the electricity was on, but the appraiser noted it to be off so he could not inspect certain things.5.) Builder has realtors who really do nothing on the transaction except show up at closing pretending to have guided you through this process in front of the lender and collects a paycheck to meet State requirements.6.) Builder will hire/use one of their inspectors once construction is complete, but they will then ignore most if not all items to be corrected in order to see what they can get away with as-is to make the buyer pick up the cost on or make the buyer go through warranty claims to get addressed.Overall the entire end-to-end process is corrupt and fraudulent from many perspectives requiring buyer to constantly have ears up expecting to hit with con game after con game. I even had a few individuals tell me "that's the way it is with every business". Um, NO. No actually it is not.If you're doing new construction, just keep eyes open and shut down these shennanigans when they happen. Right now it's shifted to a buyers market, so you can avoid the traps.
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