Buying A Brand New Home Or Commercial Building: Four Things You Should Know About Builder Warranties.
When buying a newly constructed home, you’ll likely hone in on price, location, floor plan, neighborhood, and other salient characteristics of the home. You’ll compare this neighborhood to that, this style to that, and of course you’ll want to know that the home was built with quality in mind. Similarly, if you’re building your new home, you’re wrapped up in the plethora of unending decisions like wall placement, whether outlets should be installed horizontally or vertically, door style, cabinet design–the list goes on and on. Unless building homes or purchasing real estate is old hat for you (or you just happen to be the worrying sort), thinking ahead to potential structural deficiencies or flaws that aren’t readily apparent might not be a priority for you. The house will be new, after all! Mistakes do happen in construction, however, and Montana law requires the seller or general contractor of a newly built home to provide, at minimum, a one-year warranty. Warranties typically cover workmanship and materials for that minimum year term, and major structural defects will likely be covered for a longer period of time, sometimes 7 to 10 years.
Four things you should know:
1- New build warranties are required by Montana law. Request a copy of the warranty in advance. Understand the terms stipulated within the warranty, and negotiate if necessary.
2- Know your coverage. New build warranties typically cover workmanship, materials, and major structural defects. Warranties likely will not cover the potential costs incurred if you need to vacate your home during repair.
3- Sign your warranty with your seller or general contractor. If you’re buying a newly built home, both you and the seller should sign the warranty upon purchase. If you’re contracting out the build for your new home, you and your general contractor should sign your warranty before construction commences.
4- New commercial builds do not require a warranty by Montana law. In the commercial realm, because new build warranties are not required by Montana law, it’s a good idea to do your due diligence. Enlist a lawyer to draw up a warranty agreement. Your builder or seller will be happy to sign such an agreement if they can stand behind their work.
It’s always a good idea to hire a competent construction team, and it’s great to purchase a well-built home. And still yet, it’s imperative to have an agreement that stipulates who’s responsible for what in the event of unexpected defects or need for repair within a certain time frame. Establishing these expectations up front protects you as the buyer and reassures you that you’re making a good purchase. Confident and competent builders and sellers earnestly guarantee the quality of their work.