Modular Home Contract

Six Clauses in Your Modular Home Contract

Three years ago I outlined what should be included in your Modular Home Contract.  I recommend that you take a look at that post before you read today’s entry.
Here are six clauses you may see in your modular home contract.  Their purpose is to document standard construction industry practices that you, as the Homeowner, might not know.  When put in writing, they help eliminate potential areas of disagreement between you and your modular builder.

Modular Home Contract:  Changes, Deviations, or Omissions

This clause states that you agree to accept the minor deviations that sometimes incur in construction as long as the work is substantially the same as described in the contract and within accepted industry tolerance.  Many builders don’t include this clause because the types of changes covered are usually so minor that you are unlikely to notice them.  The reason this clause is sometimes included is that a few homebuyers have been known to get very upset when there is a change of ¼” in the size of a bedroom.
The builder may also include a similar clause that refers specifically to materials and products.  Building code requirements, product availability, and design improvements may compel the builder to substitute material similar in pattern, design and quality to that listed in the plans and specifications.  When possible, the builder should consult the customer when this occurs.

Modular Home Contract:  Access to Your Property

As the Homeowner, you will at all times have access to your property and the right to inspect the work.  However, if you enter the property or invite others to enter the property during the course of construction, you all do so at your own risk.
Although your access to the property is ensured, this clause points out that you cannot interfere with the work or the modular builder, his employees, or trade contractors.  In addition, you will need to communicate directly with the supervisor assigned to your project rather than other employees or contractors on the site.

Modular Home Contract:  Work Performed by the Homeowners and Their Trade Contractors

This clause speaks to your responsibilities when you perform some of the work or directly hire contractors other than your builder to complete some of the work.  In that case, you are responsible for ensuring that you and your contractors have liability and workers compensation insurance.  You will also be responsible for coordinating this work to avoid disrupting or interfering with the work being done by the builder’s team.  Needless to say, you are responsible for the quality of this work as well as whether it complies with the building code.  In addition, you will need to take care of any warranty work.

Modular Home Contract:  Unused Materials

Builders often have unused materials after they complete their work.  Sometimes this is intended, since it’s easier to return the excess than to leave the job in the middle of the work to fetch what’s missing.  Keep in mind that you have only paid for the materials your builder has used.  This clause states that the builder owns these unused materials.  However, most builders will leave you some extra siding, shingles, paint, as well as some other materials, if they have them.

Modular Home Contract:  Signage and Marketing

Most modular builders will want permission to display a sign on your site until their work is completed.  They will also want permission to invite their prospective customers to walk through your home while it is under construction.  This clause will allow the builder to do these things, but it should also state that prospective customers visit at their own risk.

Modular Home Contract:  Building Code Compliance

Your modular dealer is responsible for ordering the home so that it complies with the state building code current at the time your agreement is written.  Modular manufacturers are required to build their homes in compliance with the code in effect at the time they build your home.  This clause states that when changes happen to the state code, you are responsible for the additional material, labor, services, and other expenses required to comply with the changes.  It also states that you are responsible for the costs associated with complying with local building codes when these codes exceed the state code.
For more information about modular home contracts, see Selecting a Modular Home Dealer and Selecting a General Contractor in my book The Modular Home.