Have you ever tried to save a dime and wound up spending a dollar?  At times it is embarrassing, but when it happens to the largest investment you will possibly ever make, it often turns tragic.  Over the last 30 years, I cannot tell you how many times I have heard from a disgruntled homeowner…after the damage is done.  It is what some call a “Horror Story.”  I’ve heard it and I know you have, or possibly even experienced it.

Story after story, job after job, stories keep surfacing.   About one out of three calls received are from troubled buyers, dissatisfied with the results obtained by not properly vetting  the most important player in their new home or remodeling project:  The Builder.  So what can we do about this and how can we keep these unwanted results from occurring?

Recently, I was appointed by Governor Jindal to serve on the Louisiana State Licensing Board for Contractors.  This commitment, to making our industry a safer and more reputable environment in which to do business, is the goal of the board.  Actually, being able to make a difference for the industry is an honor and a way for me to give  forward to those future homeowners and builders.  Getting the “bad guys” off of the street and out of commerce is just treating the symptom and not curing the problem.  As long as there is a demand, there will be a supply.  The construction process starts with a need from a consumer and properly educating the buyer is one way of tackling the challenge.

The solution is a cooperative effort from both the building professionals and the consumers.  What are the warning signs a consumer should be wary of?  What are questions that should be asked?  Learn how to identify the building professional and the following is a quick summary:

• Proper Permitting.  The first indicator is if your project is permitted.  If you are asked to take out the permit, you become the contractor of record.  Becoming the contractor of record brings along with it the responsibilities of liability and workers compensation insurance, code compliance and OSHA regulations.  Unlicensed builders cannot pull a permit within the state of Louisiana as licensed builders are required to properly permit the project.
• Proper licensing.  The Louisiana State Licensing Board for Contractors maintains a database of contractors who are licensed.  Louisiana Licensed Builder.  Select the “Is a contractor licensed or registered?” button.  If your contractor is not on the list, ask for a license number and verify.  Contractors doing remodeling projects $7,500 or more are required to have a license.
• Proper Insurance.  Ask for general liability and worker’s compensation insurance certificates with you as the certificate holder.  This should be sent directly to you from the contractor’s insurance agent to prevent the document from being altered.  Insurance is required for proper licensing.
• Check References.  Your contractor should have many references from previously completed projects.  Ask for a list and make the calls.  Past clients will be honest and you will gain valuable information from this source.
• Continuing Education.  Proper licensing requires continuing education.  The National Association of Home Builders promotes continuing education and has created the University of Housing to administer their education curriculum.  To gain a list of builders in your area that have attained theses credentials, go to Builder Education Link  By completing 64 hours of training, a builder can receive his first designation.  Not only does continuing education demonstrate the discipline of gaining industry related knowledge, it symbolizes his commitment to the industry – a trait not found with the fly by night contractor.
• Ask for a firm contract price.  Never do “cost plus” work as it promotes two things, both not in your best interest.  First, it signifies the person or firm you are hiring is not capable of providing the most essential element of the contract, the price.  It may also show the only skill you are hiring is their ability to call and schedule subcontractors and material suppliers.  Secondly, the aim to reduce costs also reduces the contractors profit, and the motivation to save on costs is not part of this model.  New home projects should never use the cost plus method and only very complicated remodeling projects should even consider using this contracting method.
• Ask for a written contract.  If you don’t get it up front, you certainly will not get it when there is a dispute.  Make certain the contract includes a detailed scope of work and most importantly the price as defined above.  It should define the payment method and terms along with the completion requirements for final payment.
• Have the contractor sign a Lien Waiver.  This should be executed at each payment and also before the final payment.  You certainly do not want to pay for the work on your home two times!
• Ask for the warranty.  In Louisiana, the New Home Warranty Act is the base warranty for any new home constructed within the state.  Go to:  New Home Warranty Act   for a copy.  The law requires the contractor of record to produce a signed copy at closing.  Note that the warranty begins on the date of sale of the residence.  An owner building their own home is bound by this law and the warranty does not begin until they sell the home some 5 to 20 years later.

Home building should be a very exciting and pleasant experience when you use a building professional.  I hope that by using the aforementioned techniques, your venture will progress smoothly without blemish.  Should you need further building information please contact one of our home professionals at the number above.

It’s been about a year since our daughter purchased a home in another city.  After we completed shopping for her home, the closing process and unpacking her boxes, we realized there was a missing component to her home buying process.  What do you do after your settled?  It’s not time to put up your feet and relax just yet!

Below is a list of things every homeowner should do shortly after moving into their new home.  At Penn Homes, we want your home to be a safe and healthy place to build lifelong memories in.

1.  Create a home maintenance checklist.

To make sure your home stays safe and healthy for you and your family, you should regularly check, clean and/or test a wide variety of interior and exterior systems and structures. The U.S. Department of Housing and Urban Development has a Home Maintenance Checklist that you can download from the HUD website . It provides basic guidelines for keeping your home dry, clean, well-ventilated, free from contaminants, pest-free, safe and well-maintained.

2.  Make sure you have enough insurance coverage.

At a minimum, you need to purchase a homeowners insurance policy to cover the house and all of your family’s belongings inside. To determine how much insurance you need, find out how much it would cost to rebuild your house today on your existing lot. Your personal property coverage should then be anywhere from 55 to 75 percent of that amount.

Damage caused by natural disasters such as flooding, earthquakes and hurricanes are not covered by regular home owner’s policies, so depending on where you live, you may want to consider additional coverage. Your insurance agent can help you figure out the right amount of coverage and suggest upgrades or additional policies that would be appropriate for your specific situation.

3.  Protect your home from break-ins.

If you bought an existing home, you should rekey the locks right away. You never know who the previous owners gave keys to. The National Crime Prevention Council recommends that every exterior door should have a dead-bolt lock with a one-inch throw. They should be at least 1 3/4 inch metal or hard wood with the hinges on the inside.

Install a peephole or wide-angle viewer—not a chain—in all entry doors so you can see who is outside without opening the door. Sliding glass doors can be secured by placing a long piece of wood at least one inch thick in the track. Keep all entrances and doors well-lit, and prune shrubs so they don’t provide hiding space for someone who wants to break in.

4.  Prepare an emergency kit.

In the event of a disaster, local officials and relief workers may not be able to reach your home immediately, so you should have an emergency kit on hand.

Basic services such as electricity, gas, water, sewage treatment, and telephones may be cut off for days, or even weeks, so you should be prepared. The Federal Emergency Management Agency recommends stockpiling at least three days’ worth of food and water for your family. Their website http://www.ready.gov/ offers a list of items to include in a basic emergency preparedness kit, as well as guidelines on food and water storage and protecting yourself from airborne contaminants.

5.  Improve your home’s energy efficiency.

Even if you’ve purchased a brand new home with the latest energy-efficient building materials and techniques, there are still some improvements you can make to save even more money on utility bills. For example:

• Replace incandescent light bulbs with longer-lasting CFL or LED bulbs.
• Install a programmable thermostat that can be set to automatically adjust the heat or air when the home is most or least used.
• Increase the insulation in your attic, on exposed water pipes and around your water heater.

The U.S. Department of Energy has an online Home Energy Saverâ„¢ tool for home owners at http://www.hes.lbl.gov/ that recommends energy-saving upgrades that are appropriate for the home, the climate and local energy prices.

Even if you haven’t just moved, these suggestions will help you protect your family and maintain your investment for years to come.  If you have any suggestions that you feel would be beneficial to a new homeowner, please comment below.  We’d love to hear your tips for moving into a new home.