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self build fixed price contract 10% deposit?

  • 17-05-2008 9:57pm
    #1
    joeclogs
    Closed Accounts Posts: 3 ✭


    I have agreed a price with a builder for our new home. We have agreed most parts of the contract apart from the stage payments. He is looking for the following stage payments terms.

    Deposit
    10%
    Ground floor level
    11%
    On completion of building to wall plate level
    18%
    On completion of Roof
    11%
    First Fix of Trades
    23%
    On completion of Windows & Plastering
    22%
    Final Payment
    4%


    I was just wondering is this usual or fair? One person advised me that he didnt pay any deposit and that payments should always be in arrears with a large amount held back. The builder told me 10% deposit is the industry standard.
    I don't know who to believe and I would like advise as to whether the above schedule is reasonable?
    Thanks


Comments

  • #2
    sinnerboy
    Closed Accounts Posts: 5,433 ✭✭✭sinnerboy


    no - industry standard is build first then get paid - in stages

    and you hold back an agreed %

    ONLY USE the RIAI BLUE FORM OF CONRACT . google for it

    and look here

    http://www.boards.ie/vbulletin/showthread.php?t=2055231996&highlight=price+detail

    DO NOT proceed as outlined by this builder

    How are insurances sorted out ? You have asked for proof of his EL/PL and CAR ?


  • #3
    Builderfromhell
    Registered Users, Registered Users 2 Posts: 1,570 ✭✭✭Builderfromhell


    Some banks prefer fewer larger stage payments.
    I would not have too much of a problem with the 10% deposite but you will very soon thereafter be paying another 11%. Could be up to Ground in 2 weeks. Also next payment is too soon.
    Most importantly you need to hold back about 5% for a year - defects liability period.
    Your supervising Architect/Engineer should be involved NOW. Make sure you have contract, see insurance etc.


  • #4
    sydthebeat
    Subscribers Posts: 42,171 ✭✭✭✭sydthebeat


    if you were to change the title of 'deposit' to 'foundations'... it would be standard.... first payment after inspection of open foundations...


  • #5
    sinnerboy
    Closed Accounts Posts: 5,433 ✭✭✭sinnerboy


    the way the builder has structured the costs you could end up paying 96% of the contract sum with no

    boiler
    lights
    power / telephone/ tv / alarm points ( 2nd fix )
    sanitary fittings
    tiling
    decoration
    floor finishes
    footpaths / fencing / gates


  • #6
    smashey
    Registered Users, Registered Users 2 Posts: 21,676 ✭✭✭✭smashey


    Tell your builder that you will have a 10% retention to cover the defects liability period. Make him sh1t himself.;)

    (I used 10% as it is a nice handy figure).


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  • #7
    sinnerboy
    Closed Accounts Posts: 5,433 ✭✭✭sinnerboy


    Smashey , you are EVIL :D


  • #8
    muffler
    Registered Users, Registered Users 2 Posts: 46,550 ✭✭✭✭muffler


    joeclogs wrote: »
    I have agreed a price with a builder for our new home. We have agreed most parts of the contract apart from the stage payments. He is looking for the following stage payments terms.

    Deposit
    10%
    Ground floor level
    11%
    On completion of building to wall plate level
    18%
    On completion of Roof
    11%
    First Fix of Trades
    23%
    On completion of Windows & Plastering
    22%
    Final Payment
    4%


    I was just wondering is this usual or fair? One person advised me that he didnt pay any deposit and that payments should always be in arrears with a large amount held back. The builder told me 10% deposit is the industry standard.
    I don't know who to believe and I would like advise as to whether the above schedule is reasonable?
    Thanks
    Dont pay a deposit - why should you? Let the guy do some work first and as has been pointed out you could agree the 10% at foundation stage.

    As was also pointed out use the RIAI form of contract and ensure you have at least 5% if not 10% retention for a defects liability period of 6 - 12 months.


    Oh, and where did the other 1% go to? ;)


  • #9
    BCS
    Closed Accounts Posts: 12 ✭BCS


    You shouldn't be required to pay a deposit if the builder is any way reputable and 10% retention is not unreasonable on smaller contracts.


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