Understanding
the Building Process
Generate a Custom Price Sheet
Construction of your new home can be both fulfilling and challenging through the process of contracting. This is not a “built with your own hands” kind of project. Although it may sound fun to tackle, most of us would never finish the project. A modular home or prefabricated home will come to the site in sections and be about 80 to 90% complete at the time it is delivered to the site. The project is more of a assembly type project with some onsite work to finish it up.
Some people wish to save money by doing their own “self contracting“, which involves hiring professional contractors. Subcontracting to have the major work completed. Their job is to be the “general contractor” who will coordinate the construction project. This requires a great deal of people skills and good organization. Communication with the subcontractors is a big key for a project to run smoothly. It greatly helps to have a clear understanding of the basic work that will be done by the subcontractors. During this process, Legendary Homes is only a phone call or email away. We are here to help make your project successful as possible!
Modular construction is a great way for folks who wish to build, to have a high quality home at an affordable price. If you’re looking for the complete “turn key” package of a new home or if you are someone who would like to oversee their own construction project. This guide will help give you an overview of the building process. The more you understand this process the better chance of having a better building experience.
Modular construction is a low risk alternative to home buyers who wish to manage building their own home of their dreams and potentially save thousands of dollars. If you would like to better understand the construction process of building a modular home we provide an easy to follow step by step description of the process.
Planning & Financing
Working With Your Lender
Finding and selecting a lender is one of the first and most important order of business to do. It’s recommended that you find a financial institution that will provide both a construction loan and a mortgage together to avoid extra fees. This is known as a “one time” close. You only close one time so you save from having to pay a lot of the closing costs twice. Plus theirs only one approval and no re-qualifications. If you are looking at being your own general contractor, then you will also want to make sure your financial institution will allow that.
NOTE: If you don’t have much experience in construction, we recommend that you let Legendary Homes provide the complete “turn key” service!
First off, you’ll need to get pre-approved for a construction loan. You should get an idea of the total amount they will loan. This will help you in deciding what type of home you will look at as far as the size and additional options you will be able to afford. They will now want you to bring a signed contract showing the floor plan, options and site improvements. Once that’s done, the construction loan process can begin.
NOTE: Remember, the lender is the expert and it’s your job to listen and ask questions. Get suggestions from them on what they recommend.
One of the first items required is a completed sworn statement. A sworn statement is a itemized breakdown of what the project will cost to build. Including the actual bids from the subcontractors and suppliers for the labor and specific material that will be used in the construction of your home. The lender will require this so they can be sure you can actually build the home for the amount of money you want to borrow.
How The Loan Works
Once the lender approves the application, the construction loan can be finalized. Once finalized the lender will issue the money towards the construction in “drawls”. The lender will generally issue the first drawl at closing. This will be for the deposit on the home and some towards the “on site” work, such as excavation to get the project underway. Please contact us for details.
When being your own general contractor you will never actually see the money. The lender will generally have a title company handle things such as verifying the work is completed, collecting lien waivers, and to pay the bills or they may issue checks directly to the subcontractor with your approval. This can vary by the state you are in and the policies of the lender.
Your Role As Contractor
If you decide to take care of your own general contracting, you will need to do your part and come through on items like materials and scheduling. Modular construction allows the process to move forward at a rapid pace with the scheduling of subcontractors. The nice thing about the speed of modular construction, for both onsite and offsite, is the ability to have multiple tasks being able to take place simultaneously.
It’s your job as a general contractor to make sure that the materials get to the job site on time and that subcontractors are scheduled and communicated with in the correct order, that the work is done properly and that everyone stays on schedule and they know about any changes.
As a general contractor, you will deal with many people such as bankers, subcontractors, insurance agents, the building inspector and many more. The building of your home will go much smoother if you are able to communicate and work will with each person.
Construction to Permanent Loans
Contact Legendary Homes if you need a lender. Our lenders offer One Time close, One Time Approval, and No re-qualifications.
Sites, Pemits & Subcontractors
Finding A Site
There are a few major items to consider when buying a site for the construction of a new home. It’s best to find higher ground for the placement of the home so you can get proper drainage. You don’t want to put the house in a low spot such as the bottom of a hill where water run off will head. Another thing to consider is if there are any easements that dictate where utility lines can go or if someone else has rights to that part of the land. Easements and lot restrictions can also influence where the house can be located on the property.
Something else to consider is how far utilities are from the location you want to position the home at. Each area varies, but to give you an idea for much of lower Michigan where Consumers Energy is the electric provider. They will run up to 600 feet of overhead electric from the nearest poles and wires at no cost. Normally anything beyond that they will charge per foot. If you plan on doing underground they will charge by the foot from the point they need to connect to. It is best to set it up and meet with a representative from the power company to get an idea of any additional costs. Natural gas is also something to take into consideration of how far the run will need to be in considering costs.
One of the main considerations of property is going to be the sewer system. If it’s in a city, you will want to be sure to check on the tap in fees and associated costs. If the land is in the country where city sewer is not available, you will want to be sure to get a perk test done. A perk test can tell a lot as far as what type of soil is there. Ideally you will want sand or gravel for the lowest costs. If the land is clay, then you should expect to pay more for the septic system which could likely be a mound system. This varies much from county to county so this is something that is good to know. Also to get an idea of they type and depth of wells in the area and if finding water can be an issue.
The type of soil can also cause the costs to be higher for hauling in sand for back-fill around the foundation, so to have better water drainage.
These are some questions you will want to know about before putting a bid in on a potential piece of property or at least before you begin doing the construction process.
Permits & Inspections
It’s also the responsibility as a general contractor to make sure to get the proper permits pulled. Also you will need to make sure that proper building codes are met and that you get the required inspections. In many cases when hiring a subcontractor such as plumbing, mechanical (heating and cooling) and electrical, they will pull the permits and get inspections with related items.
You need to follow up with these subcontractors and be sure they get inspections or you may be ripping out finished work to show the inspectors.
Planning Details
It is important to have a detailed plan of construction before you start. This isn’t just the plans of the house, but of the construction schedule and the work details that are as complete as possible.
It there are things that aren’t fully explained you risk the construction being delayed with the subcontractors. It’s best to be proactive and make sure that the instructions are as complete as possible and scheduling is confirmed.
Getting & Comparing Bids
You will need to send plans to the different subcontractors showing the required improvements required. If you as the homeowner aren’t doing the work yourself, you will need to be sure to get bids from licensed subcontractors. It may take a week or so before you get responses. Many bids may look very different, but as long as they have the same labor and materials covered you should be alright. You should not look for bids that are just lower in price, but be sure you compare what is included. Often times the lower cost bid may not save you money in the long run. It is usually very helpful to get bids from subcontractors who have experience doing work on modular homes.
Choosing Subcontractors
It’s a good idea to call the sub’s references and ask what the subcontractor is like on the job and if they stay on schedule. Also if they do a good job. I can tell you from experience that hiring good contractors is usually worth paying a little bit more extra money for. You may think it’s costing more up front, but if you get someone who doesn’t follow through and finish up, it could cost a lot more in the long run. You’ll be able to trust them more and it can prevent unpleasant experiences.
Buying Insurance
If you do a construction loan, then your lender will require you to have a policy for Builder’s Risk. If you are building your home with your own funds, this is still an important step you will want to follow. Many insurance companies will insure a “new construction” policy which will include the builder’s risk coverage. The builder’s risk policy is similar to that of a homeowner’s policy, but covers the home during the construction.
It’s a good idea to talk with an insurance agent about these options. Insurance is cheap compared to what a loss could be if something happened due to fire, theft or vandalism.
NOTE: If you don’t have much experience in construction, we recommend that you let Legendary Homes provide the complete “turn key” service for the construction of your home!
Excavation & Foundation
Excavating
Once excavation starts, things will happen pretty fast. The excavator will first clear out a path for the driveway, if needed and at least get a base rough driveway in to be able to get all the heavy equipment into the job site. After that, any trees and clearing will take place and once that is completed he will start by digging the hole for the foundation. We usually doze the top soil over into separate piles so it can be reused at the end and put back on top for easier and better grass growing.
This whole process may only take just a day or two or a few days depending on the situation. It’s critical to have this done correctly. Poorly dug holes can end up costing a lot more money in stone and concrete. It’s also critical to be sure the foundation is square and the correct dimensions. Modular homes are built pretty square at the manufacturing facility. Unlike a stick- built home, modular homes aren’t built to disguise imperfections in the foundation.
Foundation, Footings & Walls
The foundation crew will come in once the hole is dug and ready. They will be responsible for positioning the foundation measurements according to the plan. The first step in the foundation is pouring the footers. If there are any frost footers, they will also be poured. A footer inspection by the building inspector will also be requited in Michigan.
After the footers have set, normally a day or two later, the foundation crew will come in and set the forms for the walls. After the forms are set and braced they will pour the walls. Then the next day or two later the forms will be pulled off. At that time stone will also be brought in for under the basement floor (if a basement) and around the footer tile.
If any underground plumber for a bathroom or kitchen in the basement is to be done, now is the time that will be completed. A plumbing inspection will also need to be done by the plumbing inspector. After that we are ready for the basement floor.
The next step is back-fill. Once the floor is poured and just before the home is to come, we back fill the foundation. If the soil is not suitable for drainage, such as clay, sand will need to be hauled in. The sill plate and sill sealer will also need to be installed at this time.
Now we are ready for the modular home to move in.
Setting Home & Making Weather Tight!
Site Delivery of Your Modular Home
Typically a modular home will arrive in 2 or more sections. The modular boxes can be in sections of 14′ to 16′ wide and can come in lengths of up to around 76′ long. The building site needs to be managed in a way to allow the crane to set near the foundation and to be able to access the modular boxes and assemble them onto the foundation. The home may be “roll set” if the site allows.
In cases where there is limited room on the job site, a staging area may be needed to store the units offsite until the set day. If this is the case then a toter truck may be required to move the home to the modular home site. This is a standard process and is common with city and lake lots.