I understand why Texas home purchasers do this. They are very excited about building their new home and it appears to be a dream come true. After all, the builder had great reviews and plenty of pictures online of happy customers and incredible homes with all of the appointments. All that is required is to sign the contract and DocuSign sure makes that easy.
Oh, how quickly doth dreams become a nightmare – and a legal one at that!
As a Dallas Residential Home Defect Attorney with decades of experience, it still seems incredible to me that home buyers will spend their life savings in a single shot and not have a lawyer review the contract. The results can be truly tragic.
A comprehensive legal review will often determine that the buyer’s understanding of the terms of the purchase is NOT reflected in the agreement. I see this all the time. Here are a few examples:
- There is no set completion date for the construction as it is buried in contingencies.
- The cost of the construction is subject to increase without prior approval of the buyer.
- The builder is allowed to substitute less expensive materials at its discretion.
- The builder can veer from construction designs to reduce the dimensions of rooms.
- The builder is not required to adhere to the highest level of workmanship but the lowest in the industry.
- The builder can cancel the closing at its discretion and sell the home to a new purchaser for a higher price.
- Any protest by the buyer regarding lack of quality can be deemed an “event of default” resulting in the termination of the agreement.
- The buyer contracts away his/her remedies in the event the builder defaults. What this means is that if the builder violates the agreement, the buyer cannot recover damages, or they are substantially limited.
- The buyer cannot file a lawsuit in a public court if there is a dispute and must proceed before a private arbitration service.
And this is just a partial list.
The consequences of signing without knowledge of the contractual implications are heartbreaking. As a Dallas Residential Defect Attorney, I see it all the time. The circumstances vary slightly, but the results are always the same. To say that the purchasers are shocked by the egregious conduct of the Dallas Home Builder is an understatement.
The travesty usually starts with delays right off the bat with the laying of the concrete for the foundation. There is a myriad of excuses from backlogs, supply chain, to even the weather. This is invariably a very bad sign.
The clients typically respond with a positive attitude given their initial trust in the integrity of the builder and continued excitement in the home building process. This is misplaced as more problems come to the fore including further construction delays, disputes over materials, sloppy workmanship, and demands for additional cash.
In a typical situation, the builder cannot account for the funds advanced by the builder or outright lies. Things get really bad when the prospective homeowner is contacted by the builder’s subcontractors who disclose that they have not been paid. Under Texas law, they are allowed to file a Mechanics Lien against the property which is devastating to the purchaser.
And it gets worse.
The homeowner brings in an inspector and determines that there are a myriad of construction defects including bowing walls, collapsing ceiling, water intrusion/mold infestation, and shifting of the foundation, among other serious problems.
The clients’ calls to the builder are answered with antagonism or worse. In some instances, in my experience, builders have physically threatened my clients and are incredibly condescending to woman.
At their point of greatest desperation, the clients finally decide to call a lawyer, which is when my firm gets involved. At that point the damage is already done and typically litigation is the only viable option.
Bottom Line: Never sign a construction contract without first having an experienced Dallas Residential Defect Attorney review the document to make sure it reflects your understanding. Your excitement about your new home needs to be tempered by the almost 100% certainty that something undetected will go wrong.
At the Moster Law Firm we are here to help. Give us a call for a complimentary consultation.