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Lessons Learned from Years with Loans

Posted on | May 16, 2019 | Comments Off

What You Should Know about Being an Owner-Builder

Having a home that is personally built by the owner is an idea that has been through many people’s minds. However, many people never had the chance to make this happen due to factors being considered such as its probability and cost. However, some people pursue to find out more information about the idea and then discovering that there are some things that the general contractors hope you would never find out.

Being an owner-builder is something that can save you a lot of money in comparison to hiring a General Contractor. In order to be an owner-builder, you must be aware of the role and responsibilities that a general contractor would generally take care of. Some of the most crucial responsibilities of a general contractor that an owner-builder must assume is setting up a budget for the overall construction, purchasing the needed materials, monitoring the construction progress, and also hiring subcontractors.

There are times when the entire process can be very intimidating especially when interests clash together. Moreover, there are necessary paperwork that the owner-builder must take care of such as the building permit. With all the factors considered, it is very understandable why some people who has never tried to build a home would say that it is easy. The good thing is that even though it seems too tough, there is a big reward in exchange.

This great reward is the percentage that most general contractors charge as their professional fee which can cost up to 20% of the total value of the actual house. With that being said, the 20% that you would have paid to the general contractor could be used for other expenses and become part of your home equity.
No matter how you put all the other possible expenses that you will need to add to the budget if you do not have a general contractor, the total of that will still be a lot less than what you pay the contractor. Also, it must always be considered that the general contractors take over and control the entire project which means there would be less work for you, but in return you will need to pay a large fee. You also need to have a budget set out for the project manager that comes along with the general contractor to monitor the progress of the construction which means you need more money to pay for their professional fees.

An owner-builder can only be done by people that can handle great responsibilities since it is not an easy job to fulfill. If you have the willingness and the drive to accomplish this job, then there are many advantages that you can fully enjoy compared to hiring a general contractor.

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