The Building Contract or Purchase Agreement is a document, which sets out the contractual obligations between the Builder and Purchaser (or Homeowner in the case of Renovation). To be valid, any verbal understandings or agreements that lead up to the contract signing should be documented. Unless they appear in writing, verbal agreements are not part of the contract. As the Purchaser or Homeowner, you are obligated to make payment(s) and take possession of the home (if applicable) upon its completion. The Builder is obligated to construct the home or renovation according to your contractual specifications and to complete the transfer of title (in the case of a New Home). For a New Home, the Purchase Price is the agreed upon price of your new home (and lot if applicable) plus applicable taxes. For a Renovation, the Total Amount of the Renovation Contract is the agreed upon price of the Renovation plus all applicable taxes.
The Purchase Price or Total Amount of Renovation Contract also includes any agreed to changes in the plans and specifications at the time of the contract signing. Adjustments to the Purchase Price or Total Amount of Renovation Contract are normal added costs associated with the purchase of a new home or renovation. These can include: Legal Fees, Title Transfer Costs, Mortgage Application Fees, Interest Costs during construction and at Interest Adjustment Dates, and all applicable taxes.
SOME TIPS:
- Review standard clauses
- Know and stipulate what the builder is to supply and install
- Determine exactly what the purchase price or total amount of renovation contract includes
- Ensure you fully understand all aspects of the contract
- Ensure the contract accurately reflects your requirements
- Have your lawyer review the wording and your obligations
