Building a custom home in Tennessee is exciting, as it allows you to create a home that fits you, your family, and your lifestyle. However, building a custom home comes with unique legal considerations that aren’t always applicable when building a tract or spec home.
From signing contracts with builders to ensuring that your home meets specific standards, understanding these legal aspects is essential for a successful custom home build project. If you’re considering building a custom home, here’s a guide to help you navigate the complexities of getting your build underway in Tennessee.
Understanding Your Contract
When you build a custom home, the first step is signing a contract with a builder. This contract should clearly outline all aspects of the project, including timelines, costs, fees, and the build specifications.
It’s important to review and understand this contract thoroughly to avoid any surprises. An experienced Maryville contract lawyer can help you with this process to ensure the contract is fair and covers the necessary requirements for building your home up to your exact specifications.
Contracts for custom homes can be changed, but both you and your builder must agree to them. Any changes you want to make later, known as change orders, typically need to be in writing and approved by you and your builder. However this is almost never done in writing. You should insist that all change orders be in writing and signed by both parties.
Builder’s Warranty
Another crucial consideration is a builder’s warranty. This warranty should cover defects in workmanship or materials used in your home. Understanding the terms of the warranty and what it covers can save you from future headaches if something goes wrong after you move in.
Builder’s warranties for new construction homes in Tennessee provide coverage for various items for 1 year from the date of substantial completion. This period generally covers workmanship and materials, addressing any issues with the fit and finish of the home. It often includes elements like exterior siding, stucco, drywall, paint, interior trim, hardwood floors, and fireplaces.
Bank Draws and Liens
Financing a custom home involves getting the bank to release funds or draws to the builder at various project stages. Securing these draws can be challenging if the bank needs more evidence that the project is progressing as agreed. Always keep detailed records and photographs of the construction progress to facilitate these releases.
Before completing the project, ensure the builder has cleared all liens placed on the property by suppliers or subcontractors. This final release of liens is crucial to ensure that no party can make a legal claim against your property once you take full ownership.
Building to a Higher Standard
While spec houses typically meet minimum building code requirements, a custom home allows you to exceed those basics. For instance, you might use spray insulation, which isn’t required by building codes but offers better energy efficiency. Building your home to a higher standard increases its value and enhances comfort and longevity.
Building Codes
Complying with Tennessee’s building codes is essential and the building code adopted varies from one county to the next. These regulations ensure your home is safe and correctly built to last. They cover many aspects of home building and occupant safety, including:
- Fire Safety: Codes enforce safety measures to protect against fire hazards. This includes installing and maintaining fire protection systems by state and local standards.
- Mechanical Codes: These pertain to the installation and operation of mechanical systems, including heating, ventilation, and air conditioning (HVAC) systems, ensuring they meet the safety and efficiency standards outlined in the International Mechanical Code (IMC).
- Plumbing Codes: Plumbing installations must comply with the International Plumbing Code (IPC), which sets standards for designing and installing plumbing systems to promote sanitary conditions and prevent water contamination.
- Energy Codes: The International Energy Conservation Code (IECC) sets standards for insulation, windows, doors, and HVAC systems in homes. These standards have improved home energy efficiency and lead to major cost savings for homeowners.
Any custom home project in Tennessee must also involve registered design professionals (architects and engineers) when required by the complexity and size of the building. For example, homes over two stories in height or larger than 5,000 square feet typically require the involvement of such professionals.
Permit Process
Obtaining the necessary permits is another vital step in the construction process. These permits confirm that your plans comply with local regulations and are safe to proceed. Ask your building team to provide proof that they have all the required permits before construction begins to avoid legal complications. If a builder ever asks you to get the permits yourself, it could be a sign that they do not possess a contractor’s license. This is a huge red flag.
Our Tennessee Construction Lawyers Are Here to Help with Your Custom Home Build
Completed custom homes often bring their owners decades of happiness and utility. However, due to the many legal requirements and dense contracts, a lot can go wrong when building a custom home—especially for first-time builders.
The construction lawyers at Ralls & Wooten can be your legal advocates throughout this process. We have decades of experience reviewing contracts for all types of builds, including custom homes, and we can ensure your home build goes off without a hitch. Contact us today for a free consultation to learn how we can help.