Purchasing an unfinished home can save tens of thousands of dollars, thus enabling some prospective homeowners opportunity to buy a house that they may not have otherwise afforded. Unfinished homes are particularly attractive to young couples with no children and who have limited financial resources. The unfinished home concept allows young couple to grow/finish home as their family and financial resources do. In addition, if new homeowners are willing to put in sweat equity they can save significantly on finishing home.

Typically an unfinished home has a completed kitchen, living room, bath, and at least one bedroom. This is pretty much required by mortgage lenders and building inspectors as home would otherwise be considered unacceptable for living standards. In many two story unfinished homes, entire upstairs maybe left unfinished.

I have been originating and closing construction loans for a good number of years now and I have experienced clients dumping contractors and even contractors dumping clients. By that time in most cases job is running behind schedule and over budget. Choosing a new contractor at this stage is difficult and further delays are inevitable.

Spending a little more time and paying a little more attention to process of choosing your contractor can avoid all this.

In most cases writing is on wall from very first day, but wishful thinking gets in way of logic, which leads to disaster down road.

A good number of articles have been written on subject, and you should try reading at least one or two well before making your choice of a contractor.

This article is based on my experience and personal observations. You may whish to write main points down and add others that I have not covered and indeed add to list from your own experience of dealing with people. This way you will internalize subject and become a naturally better judge of those you do business with.

During processing of your construction loan, some information is collected from contractor but that should not stop you from your due diligence. Here is a list of items to check and to look out for:

1- If your state requires a state license, ask for number. Don’t stop at that. Call relevant state board and check on license’s status. You don’t know who regulates contractors in your state? Ask Him/Her. And pay attention to reaction.

There is no need to be shy. A legitimate and honest businessman will have no problem providing information. We are involved in a highly regulated business and we proudly provide relevant information along with phone numbers and links to state bodies on our About Us page.

2- Ask for references. Pay attention to reaction. Too quick a reaction and fast talk is probably a lie and a bluff. Too cautious a reaction is a sign of uncertainty. In any event write names and numbers down and do call them. Go see them. Most people will actually welcome you simply to show off their achievement. 3- Are you building a home from ground up? Make sure contractor has built a complete project in past. Experience counts; a ground up construction or a major remodel is a very different animal from room and bathroom additions.