Building Your Custom Home For Dummies

Title Page
Copyright Page
Table of Contents
Introduction
About This Book
Foolish Assumptions
Icons Used in This Book
Beyond the Book
Where to Go from Here
Part 1 Getting Started with Custom-Home Building
Chapter 1 The Custom-Home Process in a Nutshell
Where Do You Start? Preparing to Build Your Home
Money Makes the World Go Round: Paying for Your Home
Asking yourself about affordability
Them that has the gold makes the rules: If you finance, the bank will dictate process
Introducing the Custom-Home Life Cycle
It takes (more than) two to tango: A quick guide to the players
So many tasks, so little time: Fifty steps to a custom home
Patience is a virtue: A true timeline for building your home
Being an Owner-Builder: More Power to You!
Analyzing the truth about savings
Finding and managing subs
Financing implications
Chapter 2 Preparing for the Process
Organizing and Documenting
Building a workbook and portable file system
Calendar and communication: Your smartphone is your friend
Being the bean counter: Keeping track of your finances
Shopping and sharing: Collecting material information
Budgeting Your Project
Looking at your finances and cash flow
Defining “dollars per square foot”
Using a budgeting template
Hiring a Contractor
Understanding the contractor’s role
Getting bids: Comparing apples to apples
Evaluating a contractor’s three Cs: Cost, craftsmanship, and compatibility
Using expert interviewing techniques
Identifying Insurance Issues
Liability policy
Workers’ compensation
Course of construction policy
Managing Your Expectations
Planning a timeline: A custom home is forever (so, what’s the hurry?)
Making hard choices: What you can (and can’t) afford
Having patience: Not everything must be perfect right away
Making the process fun
Chapter 3 The Land Grab: Selecting the Perfect Site
Knowing the Difference between Land and a Lot
Location, Location, Location: Refining Your Lot-Buying Needs
Lifestyle
Marketability
Finding a Lot
Surfing for turf
Engaging a real-estate agent/lot specialist
Doing the legwork on your own
Finding a lot when there isn’t one
Evaluating a Particular Lot: The True Value of Dirt
Examining amenities and utilities
Zoning in on zoning’s limitations
Understanding setbacks and footprints
Size matters: Assessing the land’s value with the house
A tale of two lot buyers: How square footage impacts value
Dealing with a Teardown Property
Accounting for demolition costs
Assessing neighborhood tolerance
Financing pros and cons
Buying Your Land
Understanding the purchase process
Using the bank
Finding other land loan alternatives
Making sure the loan period is long enough
Stop! Don’t pay off your lot yet!
Chapter 4 Defining Your House Style
Getting to Know Your Style Preferences and Limitations
Educating your eye
Discovering your local style
Playing by community rules
Tapping the wisdom of the pros
Considering Conventional Construction: Wood versus Steel
Enjoying the Warmth of a Log Home
Two ways to skin a log
Purchasing your log package
Highlighting Wood Inside: Timber Frame or Post-and-Beam
Considering a System Approach
Weighing your options
Making a purchase
On the line
Unearthing Alternative Construction Methods
Part 2 Assembling Your Team
Chapter 5 Architects and Design: Time Spent Is Money Saved
Arming Yourself with an Architect
Deciding whether you even need an architect
Finding the right architect
Managing the architecture process
What does all this cost?
Looking at Architect Alternatives
Published floor plans: Picking a home from books or online
Software programs: Designing your own plans
Hiring a home designer
Placing the House on the Lot
Foundation issues
Which orientation is best? North, south, east, or west
Taking advantage of natural elements
Planning the Size and Shape of Your Home
Size matters: Figuring the right square footage
Resale potential: Creating a house everyone wants to buy
Exterior styles: Considering architecture examples
Designing Your Home’s Interior
Ten general floor-plan considerations
Special considerations room by room
So Many Details, All of Them Important
Materials, hardware, fixtures, and finishes
Allowance is a dirty word: Making all your decisions now
Energy efficiency: Saving the earth (and your money!)
Chapter 6 Engineers and City Folk: Approval Bureaucracy Made Somewhat Easy
Understanding Plans and Blueprints
Prelims: Floor plans, site plans, and elevations
Working drawings: The how-to-build-it papers
Working with the Building and Planning Departments
Submitting Your Prelims for Approval
Addressing grading, septic, and well issues
Understanding design guidelines
Requesting variances and exceptions: Don’t be Don Quixote
Not so fast: Acquiring neighbor approval
Gathering the Permits You Need
Submitting and revising the working drawings
Picking up permits and paying the fees
Chapter 7 All the King’s Men: The Contractor and Their Cohorts
Working with Your Contractor
Fostering good communication: A meeting a day keeps the anger away
Maintaining a productive work environment
Change orders: Dealing with indecision
Maintaining a happy and healthy relationship with your contractor
Managing Your Time and Money
Executing contracts
Scheduling the project
Controlling the funds: How to manage the bank account
Introducing Other Important Players
Dealing with suppliers
Working with subs: Each one is an expert
Preparing for building and bank inspectors
Managing Disputes
Avoiding mechanic’s liens: The contractor’s weapons
Using legal remedies: Arbitration and attorneys
Part 3 All You Need Is Dough: Financing Your Custom Home
Chapter 8 Cash Is King: Borrowing to Your Advantage
Accepting the Need for Liquidity: Cash, Cash, and More Cash
Breaking the Emotional Barriers: This Is Not Your Grandfather’s Depression
Evaluating real estate within your net worth
Seeing why secured debt can be good
Getting on the same page: How banks evaluate risk
Changing perspective: Home equity isn’t a savings account
Understanding the benefits of liquidity
Okay, So You Have All This Cash — Now Manage It
Finding and working with a financial adviser
Diversifying your portfolio
Exploring alternative investments
Turning Your House into a Moneymaking Machine
More house for less cash: Benefiting from leverage and appreciation
Protecting your investment by making it marketable
Understanding taxes: Some parts of a home project are deductible
Safely Deferring Financial Decisions until the End of the Construction Project
Chapter 9 Knowledge Is Power: What You Don’t Know about Construction Loans Can Hurt You
Exploring Your Construction Loan Options
Finding a Good Construction Lender
Choosing a broker or a bank
Testing a loan officer’s knowledge
Getting value added: Education and experience are worth the money
Private money: The last resort
The Loan Process from Start to Finish: When to Do What
Deciding when to sell your existing house
Applying on time
Getting the loan after construction starts
Preparing the paperwork
Locking in an interest rate
Determining the length of your construction loan
Understanding All the Fees
Points
Escrow and title: More than with other loans
So many appraisal fees
Insurance costs
All the little stuff
Letting the Lender Carry Your Burden
If someone offers you money, take it
No payments: Taking an interest reserve
Chapter 10 Qualifying: It’s the Bank’s Way or the Highway
Stepping behind the Desk: How a Construction Lender Views Your Project
Why some lenders may seem uncaring
How lenders assess risk
How banks view your property
How lenders view contractors
How lenders view occupancy
How lenders view spec projects
Recognizing What a Construction Lender Really Wants to See
On your credit report
On your tax returns
In your bank accounts
On the appraisal
Building the Bank’s Construction Budget
Land costs
Soft costs
Hard costs
Contingency
Interest reserve
Closing costs
Totaling up the cost to build
Calculating the Loan Amount and Cash
Basing the loan on finished value
Basing the loan on cost to build
Calculating the cash needed for the project
Solving Other Budget Problems
Landscaping and finish work can kill the project
Costing: What if I can build on the cheap?
What if I need more cash than is in my budget?
Chapter 11 Show Me the Money: Flowing Cash through the Project
Managing a Self-Funded Project
Working with a Construction Lender
Of course, you don’t get all the money up front
Preparing for inspection
Lobbying the lender
Understanding How the Voucher System Works
Taking a Closer Look at the Draw Reimbursement System
Figuring which costs are which
Managing the flow of funds with percentages and contingencies
Paying the subs
Dealing with deposits
Using the draw system to pay for your log or kit home deposits
Acing your finals: Final completion and final funds
Figuring Out Who Gets the Money — You or the Contractor
Using Credit Cards Responsibly Can Buy You a Trip to Europe
Part 4 Hammers and Nails: Overseeing the Construction Process
Chapter 12 Excavation and Foundation: Getting a Solid Start
Surveying and Site Preparation
Examining your land
Using your survey
Preparing your site before the first shovelful
Dealing with trees
Clearing and grading
Constructing retaining walls
Providing drainage
Marking the build site
Spot-check: Surveying and site preparation
Preparing for the Utilities
Connecting water
Hooking up to the sewer
Installing septic systems
Bringing in electricity
Piping in gas
Spot-check: Utilities
Pouring the Foundation
Excavating the site
Installing the foundation
Spot-check: Foundations
Chapter 13 Framing and Rough: So Much Goes behind Those Walls!
Things to Consider Before Framing and Rough Work Begin
Questions to ask your contractor
Establishing a schedule
Trusses and I-beams: Yes or no?
Looking at What’s Involved in Framing a House
Understanding the framing process
Spot-check: Framing
Installing the Rough Systems with Ease
Rough plumbing
Spot-check: Plumbing
HVAC
Spot-check: HVAC
Rough electrical
Spot-check: Rough electrical
Sheathing, Flashing, and Insulation
Covering the framing: Sheathing and flashing
Rolling out the insulation
Spot-check: Sheathing, flashing, and insulation
Chapter 14 Heading for the Finish: The Devil’s in the Details
The Icing on the Cake: Exterior Finishing
Applying wall coverings
Finishing an attached deck
Up on the roof: Roofing and rain gutters
Selecting and installing your shingles
Gutters and drainage
Installing the driveway: Finish options
Exterior lighting
Spot-check: Exterior finishing
Moving Inside: Completing Fireplaces and Walls
Fireplaces and hearths
Drywall and wall textures
Spot-check: Fireplaces and walls
The Finish Carpenters: Doors, Windows, Molding, Cabinets, and Countertops
Doors and windows
Baseboards and moldings
Cabinetry and countertops
Spot-check: The finish carpenters
All the Pretty Stuff
Painting
Hardware and fixtures
Flooring materials
Appliances
Spot-check: Painting, fixtures, flooring, and appliances
Part 5 All the After Stuff
Chapter 15 Making a House a Home: Moving In, Furnishing, and Using Smart Tech
Finishing Up the Custom-Home Project
Getting your certificate of occupancy
Obtaining the mechanic’s lien releases
Rolling the construction loan: Choosing a final loan amount and program
Taking the final contractor walk-through
Selling the Old Home and Moving
Considering Technology Options
Chapter 16 Taking It Outside: The Art of Landscaping and Hardscaping
Designing Your Dream Landscape
Using a designer: Yes or no?
Revisiting your site plan
Considering your wants and needs
Dealing with your climate
Saving time and money by design
Getting your plan on paper
Putting Your Plan in Action: Hardscaping
Planning a patio, daddy-o
Lounging on the deck
The art of fencing
Building great walls
Adding water
Lighting the way
Leafing Out: Softscaping with Plants
Planting trees after construction
Adding texture with shrubs
Bloom time: Annuals and perennials
Chapter 17 Making Your Nest Egg Financially Sound
Managing Maintenance and Repairs
Understanding the builder’s long-term responsibilities and warranties
Dealing with construction defects
Should You Stay or Should You Go?
Being aware of new neighborhood trends
Looking at the tax implications
Identifying the Best Permanent Financing Solution
Fixed versus adjustable rate
Pay it off or not
Refi down the line
Part 6 The Part of Tens
Chapter 18 Ten Common Custom-Home Mistakes and How to Avoid ’Em
Designing a House Unlike Others in the Neighborhood
Attempting to Build outside the Design Review Guidelines
Thinking the House Will Be Worth What It Costs
Paying Off the Lot Before Starting to Build
Waiting for Permits to Investigate Construction Financing
Applying for the Construction Loan Too Early
Applying to Too Many Lenders
Borrowing the Minimum to Get By
Spending Your Own Money First
Selling Your Existing Home Before Building the New One
Chapter 19 Ten Great Ways to Lower Construction Costs
Build the House That Suits the Land
Make It Tall to Keep Your Budget Small
Keep It Simple and Tasteful
Use Design Elements to Eliminate Costly Materials
Choose and Order Items in Advance
Use Surplus Materials for an Old-Style Home
Group Simple Windows for a Custom Look
Avoid Change Orders
Go Faux
Get Creative
Chapter 20 Ten Common Stuck-in- the-Middle Problems and Their Fixes
My Home Is Behind Schedule
My Construction Loan Is Expiring and the House Isn’t Complete
My Contractor Wants More Money in a Fixed-Price Contract
Everything Costs More Than My Budget in a Time-and-Materials Contract
The Bank Won’t Fund the Draws
I’m Out of Cash
The House Is Having Some Engineering Problems
My Contractor and I Can’t Get Along
My Contractor Walked Off the Job
This Project Is Breaking Up My Marriage
Chapter 21 Ten Ways to Build Sustainably
Making the Best Use of Your Lot
Avoiding an Oversized House
Planning for the Ages
Making Your Landscape Earth-Friendly
Using Alternative Energy Sources
Going on an Energy Diet
Cutting the Fumes
Making Recycling Easy
Using What You Have
Stashing and Storing
Chapter 22 Ten Helpful Custom-Home Resources
Land Ho! Finding Land to Build On
Finding Home Design Inspiration
Decorating for the Uninitiated
Building a Log or Timber Frame Home
Looking for Home Plans
Working with an Architect
Turning to the National Association of Home Builders
Getting Support if You Want to Be Your Own Builder
Designing a Home with the Environment in Mind
Landscaping Your Home with Native Plants
Index
EULA