5 Ways To Prevent Working With An Illegal Builder When Building A New Home

by Pam on March 20, 2017

If you are planning on starting to build your dream home or cottage, you are likely very excited – perhaps to the point that you may have not considered ways to protect yourself against hiring an illegal builder.  Below are five tips you should consider before you start your big project.

  1. Hire a Registered Builder

Did you know that there are so-called builders out there who are actually building illegally?  To ensure that you hire a licensed builder, check if they are registered by visiting your province’s builder directory online, if there is one of course.  In Ontario, Canada, builders must, by law, be registered with Tarion, the province’s warranty administrator and regulator. To confirm registration, simply go to their website and checkout their Ontario Builder Directory.  Only builders who have demonstrated specific competencies are licensed and listed.

It is very important that you do not enter into any agreement with any builder until you have ensured that they are in fact registered and reputable.  Remarkably, a recent survey found that almost 7 in every 10 Ontarians did not know that a builder must be registered to build legally.  Protect yourself and   do not disregard this very important first step in hiring a builder.

  1. New Home Warranty Coverage

Another big reason to use a registered builder  is to ensure that you understand your rights and responsibilities under the new home warranty. Illegal builders are typically trying to avoid regulation and often do not make homeowners aware of the protections available to you.   In Ontario, almost every new home built comes with a warranty that last up to 7 years.  In the same survey mentioned earlier, only 5 in 10 Ontarians were aware of this protection.   Protect yourself by understanding the warranty and what it covers.

  1. Insist Upon a Written Contract

Never accept a verbal contract.  Always insist that the agreement between you and your builder be written down.  This eliminates confusion, formalizes the agreement as a legal document, and gives you something to refer to rather than relying on memory alone.  This provides protection because if the builder deviates from the contract, you can bring it to their attention and ensure that they honour the terms of your agreement.

  1. Hire an Experienced Real Estate Lawyer

Another reason why a written contract is so important is that you have the option of hiring a professional to take a look at it, revise it, or even to write it for you, to ensure that you are not missing anything important.  You don’t want to sign anything until you understand fully what you are agreeing to.  You’re about to spend more money than you’ve likely ever spent before, why not hire a legal expert to help protect that investment?

  1. Understand Your Rights & Responsibilities

As a new home owner, you have rights and responsibilities when it comes to your new home and its warranty.  Make sure that you hire a licensed builder and get a written contract to protect both yourself and your new home.  By being cautious and following the steps above, you will be far less likely to run into trouble when it comes to your new dream home-building project.  It’s the first right step to ensuring your dream doesn’t become a nightmare.

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