However, owner builder construction loans are a tricky animal. Not only are the very difficult to find, but they can also be a lot more complicated than the typical purchase or refinance loan. Indeed, owner builder construction loans can be a lot more complicated than even a regular construction loan.

Therefore, if you are considering being an owner builder and managing the construction of your new home, then you need to make sure your owner builder financing has the following three features. These three owner builder construction loan features are imperative to the success of your project.

1. Owner Builder Loan Imperative One: A Line Item Budget with Unlimited Draws

Owner builders don’t sign a contract with a licensed general contractor to build their home for them. Instead, an owner builder must put together a detailed budget of the costs to build their new home.

If you are building your home with a licensed general contractor, the construction loan will typically have a fixed number of construction draws to fund the project. For example, the loan may have only five draws that are issued based on the percentage of completion of the home. Therefore, the builder will have to fund the construction until a draw can be taken.

For owner builders, though, this is usually not possible. Owner builders can’t fund construction out of pocket, relying on taking only five draws during the course of the project.

Instead, if you are going to be an owner builder, you are going to need the ability to take an unlimited number of draws during construction, based on the specific itemized budget that you put together during the planning phase.

With an owner-builder line item budget, you can take loan draws every step of the way. When you clear your land, you can take a draw. When dig the hole for your foundation, you can take a draw. This way, owner builders don’t have to carry the costs of construction out of their own pockets. Not having an itemized budget with unlimited draws is a recipe for disaster for owner builders.

2. Owner Builder Loan Imperative Two: The Owner Builder is in Control of the Draws

With typical construction loans, the general contractor will request the loan draws. Many times, the borrower will be required to sign for the draws in addition to the general contractor. However, even in this case, the general contractor has fifty percent of the control of the construction loan draws.

For owner builders, this is not an option. An owner builder needs to be in complete control of the loan draws. The sub-contractors should not be allowed to have any say over the draw process.

As long as the owner builder is the only person who can request the draws, without input from the sub-contractors, then there is no chance of the sub-contractors getting paid until the owner builder is fully satisfied with the work that they did.

If a sub-contractor gets paid prior to doing satisfactory work, the poor owner builder will never get his house built. Instead, you’ll be out of money before the roof is on.

Therefore, if you want to be an owner builder, ensure your construction loan is designed to keep you, and only you, in charge of the construction draw process. If you can do this, then you will never have to worry about giving money to one of your sub-contractors before they have finished the job.

3. Owner Builder Loan Imperative Three: Minimizing Your Loan Down Payment

Every construction project has cost over-runs. Sometimes, those extra costs won’t be fully covered by your construction loan. Therefore, it’s imperative that an owner builder has some cash set aside to be fully prepared for any small cost overages.

If your owner builder construction loan requires no down payment, or even a very small down payment, then you can keep as much cash as possible in your own pocket for the construction phase.

If you want to put the money into your construction loan to keep your monthly mortgage payments as low as possible and keep your equity as high as possible, then make sure your owner builder loan will allow you to pay down the balance at any point during construction.

Therefore, if you have no down payment, you can keep the money in your bank account to protect yourself from cost overages. And, when you are safely finishing your construction on budget, you can use that money to pay down the balance of your owner builder construction loan prior to converting over to your permanent mortgage. This way, you’ll be protected and have a smaller monthly mortgage payment.

Most construction loans require at least a ten percent down payment. In fact, many require a twenty percent down payment. However, if you can find an owner builder construction loan that will require little to no down payment, you will be well ahead of the game.

It’s possible for owner builders to minimize their down payments, because a good owner builder construction loan will cover up to 100% of their costs as long as there is a large spread between the cost to build and the finished value. (There should be a very large spread between the cost to build and the finished value if you are an owner builder, cutting out the overhead of a general contractor.)

Therefore, if you want to save tens of thousands of dollars by building your own home without hiring a general contractor, then you will need to find the right owner builder construction loan.

These loans can be difficult to find, and they are almost always a bit more complicated than a typical purchase loan. However, a good owner builder construction loan will always have these three essential features: a line item budget with unlimited draws, owner builder control over those draws, and a minimal down payment requirement.

People Come Here Using:

Luckily, the internet has helped a lot of people over the years when it comes to relocating and is an excellent source of relocation information. There is much that you can find out about a new area by conducting a little online research. If you need to relocate quickly, the Internet can be very helpful.

The Internet can help you find a home or apartment, give you a general idea of what the area is like, provide contact information for schools, realtors, leasing offices, and other relocation specialists, allow you to rent moving trucks or vans, research basic information about electric companies, cable companies, DMV, vehicle registration requirements, tax information, restrictions, and many more things.

Another reason to research and gather relocation information is that it can help you save money. The costs to relocate can be larger than expected and many times it’s those unexpected costs that can add up and cause more stress. Common costs associated in relocating include packing materials, boxes for moving, tape, special containers, blankets, shrink wrap, home moving companies to pack, load, unload, and transport items, moving trucks and vans, fuel, transportation, renting a van or truck, temporary housing, and vehicle transportation.

Looking for relocation information on the internet is a very good way to find the best prices and referrals to help find the things you will need for the move. It will not only save you the stress of doing many things yourself, but also give you a great choice of relocation assistance to choose from and prices that fit your budget. Use the Internet to get an idea of what is available and then start creating a list of possibilities and making appointments.

It is also a good idea to look for relocation information that assists you in creating a guide and time line for your move. There are many great tips that can save you a lot of time and are worth investigating before starting the moving process. These may include valuable relocation information like how to pack your items correctly, break large tasks into smaller ones, share responsibilities with your partner, spreading tasks over time, and creating a budget.

Stress can occur any time during the process of relocating. Even those who are eager about moving may find themselves overwhelmed by the small details. That is why gathering relocation information beforehand can help reduce the amount of stress associated with moving and let you focus on other things such as, saying goodbye to friends and family, and taking care of last minute details.

No matter if you are planning a large international move, a move across the country, or are just planning on moving across town, collecting and researching relocation information before moving will save you time, money and a lot of stress.

Plan to take a few days before starting the moving process to gather valuable tips and research prices of home moving companies, packing materials and vehicle transportation companies in order to have the best moving experience possible.

Behind every successful move is a successful plan. Planning a successful move will come from doing your research and taking advantage of the relocation assistance and benefits you will find by researching relocation information.

Now days, the internet has helped a lot of people over the years when it comes to relocating and is an excellent source of relocation information. There is much that you can find out about a new area by conducting a little online research. If you need to relocate quickly, the Internet can be a great help.

The internet can help you locate a home or apartment, give you a general idea of what the area is like, provide contact information for schools, realtors, leasing offices, and other relocation specialists, allow you to rent moving trucks or vans, research basic information about electric companies, cable companies, DMV, vehicle registration requirements, tax information, restrictions, and much more.

Another reason to research and assemble relocation information is that it can help you save money. The costs to relocate can be larger than expected and many times it’s those unexpected costs that can add up and cause more stress. Common costs associated in relocating include packing materials, boxes for moving, tape, special containers, blankets, shrink wrap, home moving companies to pack, load, unload, and transport items, moving trucks and vans, fuel, transportation, renting a van or truck, temporary housing, and vehicle transportation.

Searching for relocation information on the internet is a excellent way to find the best prices and referrals to help find the things you will need for the move. It will not only save you the stress of doing many things yourself, but also give you a great choice of relocation assistance to choose from and prices that fit your budget. Use the Internet to get an idea of what is available and then start creating a list to help you.

It’s also a great idea to look for relocation information that assists you in creating a guide and time line for your move. There are many great tips that can save you a lot of time and are worth investigating before starting the moving process. These could include valuable relocation information like how to pack your items correctly, break large tasks into smaller ones, share responsibilities with your partner, spreading tasks over time, and creating a budget.

Stress can creep in during the process of relocating. Even those who are eager about moving may find themselves overwhelmed by the small details. That is why putting together relocation information beforehand can help reduce the amount of stress associated with moving and let you focus on other things such as, saying goodbye to friends and family, and taking care of last minute details.

If you are planning a large international move, a move across the country, or are just planning on moving across town, collecting and researching relocation information before moving will save you time, money and a lot of stress.

It would be nice to plan to take a few days before starting the moving process to assemble valuable tips and research prices of home moving companies, packing materials and vehicle transportation companies in order to have the best moving experience possible.

In advance of every easy move is a successful plan. Planning a successful move will come from doing your research and taking advantage of the relocation ideas and benefits you will find by finding relocation information.

Now days, the internet has helped a lot of people over the years when it comes to relocating and is an excellent source of relocation information. There is much that you can find out about a new area by conducting a little online research. If you need to relocate quickly, the Internet can be a great help.

The internet can help you locate a home or apartment, give you a general idea of what the area is like, provide contact information for schools, realtors, leasing offices, and other relocation specialists, allow you to rent moving trucks or vans, research basic information about electric companies, cable companies, DMV, vehicle registration requirements, tax information, restrictions, and much more.

Another reason to research and assemble relocation information is that it can help you save money. The costs to relocate can be larger than expected and many times it’s those unexpected costs that can add up and cause more stress. Common costs associated in relocating include packing materials, boxes for moving, tape, special containers, blankets, shrink wrap, home moving companies to pack, load, unload, and transport items, moving trucks and vans, fuel, transportation, renting a van or truck, temporary housing, and vehicle transportation.

Searching for relocation information on the internet is a excellent way to find the best prices and referrals to help find the things you will need for the move. It will not only save you the stress of doing many things yourself, but also give you a great choice of relocation assistance to choose from and prices that fit your budget. Use the Internet to get an idea of what is available and then start creating a list to help you.

It’s also a great idea to look for relocation information that assists you in creating a guide and time line for your move. There are many great tips that can save you a lot of time and are worth investigating before starting the moving process. These could include valuable relocation information like how to pack your items correctly, break large tasks into smaller ones, share responsibilities with your partner, spreading tasks over time, and creating a budget.

Stress can creep in during the process of relocating. Even those who are eager about moving may find themselves overwhelmed by the small details. That is why putting together relocation information beforehand can help reduce the amount of stress associated with moving and let you focus on other things such as, saying goodbye to friends and family, and taking care of last minute details.

If you are planning a large international move, a move across the country, or are just planning on moving across town, collecting and researching relocation information before moving will save you time, money and a lot of stress.

It would be nice to plan to take a few days before starting the moving process to assemble valuable tips and research prices of home moving companies, packing materials and vehicle transportation companies in order to have the best moving experience possible.

In advance of every easy move is a successful plan. Planning a successful move will come from doing your research and taking advantage of the relocation ideas and benefits you will find by finding relocation information.

Now days, the internet has helped a lot of people over the years when it comes to relocating and is an excellent source of relocation information. There is much that you can find out about a new area by conducting a little online research. If you need to relocate quickly, the Internet can be a great help.

The internet can help you locate a home or apartment, give you a general idea of what the area is like, provide contact information for schools, realtors, leasing offices, and other relocation specialists, allow you to rent moving trucks or vans, research basic information about electric companies, cable companies, DMV, vehicle registration requirements, tax information, restrictions, and much more.

Another reason to research and assemble relocation information is that it can help you save money. The costs to relocate can be larger than expected and many times it’s those unexpected costs that can add up and cause more stress. Common costs associated in relocating include packing materials, boxes for moving, tape, special containers, blankets, shrink wrap, home moving companies to pack, load, unload, and transport items, moving trucks and vans, fuel, transportation, renting a van or truck, temporary housing, and vehicle transportation.

Searching for relocation information on the internet is a excellent way to find the best prices and referrals to help find the things you will need for the move. It will not only save you the stress of doing many things yourself, but also give you a great choice of relocation assistance to choose from and prices that fit your budget. Use the Internet to get an idea of what is available and then start creating a list to help you.

It’s also a great idea to look for relocation information that assists you in creating a guide and time line for your move. There are many great tips that can save you a lot of time and are worth investigating before starting the moving process. These could include valuable relocation information like how to pack your items correctly, break large tasks into smaller ones, share responsibilities with your partner, spreading tasks over time, and creating a budget.

Stress can creep in during the process of relocating. Even those who are eager about moving may find themselves overwhelmed by the small details. That is why putting together relocation information beforehand can help reduce the amount of stress associated with moving and let you focus on other things such as, saying goodbye to friends and family, and taking care of last minute details.

If you are planning a large international move, a move across the country, or are just planning on moving across town, collecting and researching relocation information before moving will save you time, money and a lot of stress.

It would be nice to plan to take a few days before starting the moving process to assemble valuable tips and research prices of home moving companies, packing materials and vehicle transportation companies in order to have the best moving experience possible.

In advance of every easy move is a successful plan. Planning a successful move will come from doing your research and taking advantage of the relocation ideas and benefits you will find by finding relocation information.

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Construction Delays and Claims

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Construction Delays and Claims

By: Construction Manager

About the Author

(ArticlesBase SC #3473893)

Article Source: http://www.articlesbase.com/ – Construction Delays and Claims

Claims and Delays are commonly associated with construction and its related activities. By virtue of the inherent risk involved, limited trade skill, complexities of design, weather and external factors all has a role to play in creating this undesired situation.

Let’s face it, most people don’t sign up to a service or agreement with the intent of laying a claim or seeking legal advice or even prosecution. In fact most of us wish only to be given the opportunity to deliver / provide or construct what we have set out to do at the agreed price and make the intended profit. However construction is not as simple and there is always that one contract/project which demands more contractual awareness and protection than others.

Most contractors are not legal experts and find themselves all too often in a situation where a delay has occurred whereby they did not have the necessary paperwork or records in place to make such a recovery. This leads to frustration and desperation where the contractor starts claiming for everything without proper analysis and in the end tables an unmanageable global claim which leaves a sour taste for all the parties involved. Client’s generally retaliates by imposing penalties and delaying payments. The Engineers on the other hand become biased as these claims are seen as a personal attack on their abilities and actions. All of which ends up in most cases where a Lawyer or a Claim Consultant’s involvement is sought at great expense and to the detriment of the Project.

Obviously in some instances the route of legal intervention is unavoidable due to either party not complying with their obligations under the Contract. However the above scenario sketches the common situation many contractor face in the industry. The process of claiming or identifying delays or loss should not be such a confrontational event. In fact the very purpose of this process is actually to protect both contracting parties and obtain resolution. For the client / Engineer to understand a delay impact prior to its occurrence, will greatly allow him the opportunity to act or rectify and secondly obtain knowledge of the event and the consequences involved. This will ease the tension and path the way for negotiation where an amicable solution in terms of time and money is found. This is clearly a win-win solution.

In order to achieve this however the Contractor needs to be in control of its administrative responsibilities, understand his contractual obligations and prescription clauses.  One way to make sure this risk is managed is by utilizing pre-configured document templates that guides the user to record the correct information and prompts when the next notice or warning should be submitted. Templates saves time and provides a low cost solution to managing risks. And most importantly it will ensure that the information is received by the other party on time and in the correct format to allow action to be taken. Remember the more time given the more opportunity there is to resolve.

That said, it is not so easy to create templates for delays or claims if you are not affluent with Contracts and the processes involved. Therefore the best solution would be to seek legal assistance in drafting these for you or use existing document templates developed by other Contractors. There are a few websites that provide such a solution namely Template Store which provides 46no. Word and Excel document templates for various contractual management scenarios. For a relatively inexpensive solution you can start managing and controlling your risk immediately. This template package covers all aspects from notices, claims, cost recording and processes involved of keeping records for delays.

Avoid a lose-lose situation which will ultimately tarnish your reputation and success in the construction industry. Take action today!

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Source:  http://www.articlesbase.com/project-management-articles/construction-delays-and-claims-3473893.html

Article Tags:
construction delays, extension of time claims, delay notices, how to record delays, avoiding global claims, how to give early warning, contract management, claim and delay management, claim procedures

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