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 Dear
Steve,
We bought a new home due to be completed by December
2007. But the builder moved the completion date
to August -- four months early! We put down a
deposit on that home and are now concerned we
won't be able to sell our existing house by then.
Can we get our deposit back because of this?
-- Beth
 Dear Beth,
It is highly unlikely.
Most letters we receive about home
builder completion dates, by the way, complain
about how late homes are getting finished, not
early. But I suspect more new homes are getting
completed in a timely manner these days because
builders are scaling back on volume in the face
of diminishing demand -- plus they don't want
to give their shrinking universe of buyers any
legal fodder whatsoever to back out of contracts.
In fact, a lot of buyers of newly
built and custom-built homes would love to be
facing your unique "problem."
Moreover, several home builders
are putting first-person customer testimonials
on their Web sites from people chirping happily
about the fact that their homes were finished
early.
As for the slim likelihood of getting
your deposit back and canceling the deal, the
answer lies in the language of your builder contract.
Contracts often spell out what will happen if
you're forced to move out of your old house before
the new one is done and will even call for late-completion
penalties that make builders shoulder a portion
of interest on the buyer's construction loan.
But I haven't seen any that cover the ramifications
of an early completion date -- although
that doesn't mean there aren't some out there.
This brings up another key issue:
I can't stress enough how the most important transaction
in a buy-sell scenario is the sale of the existing
house, especially now that most markets are flat.
You can usually count on finding ample for-sale
inventory in any given market but you can never
be sure your house will sell in a given time frame,
particularly these days. If homeowners do sell
faster than expected, they can always secure a
temporary rental and/or interim storage space
for their stuff. But they can't usually afford
to pay two mortgages for an indefinite span!
Certainly, you should approach the
builder about the spot you're in. But it's highly
unlikely he'll relent because he is, after all,
delivering your home on time and then some.
A court case would probably cost more than it
would be worth and may have little or no merit.
By all means, though, run your question through
a real estate attorney if you still want to exit
your contract. He or she may find other grounds
to do so.
In short, failure to perform can be a punishable offense. But performing too efficiently? Probably not!
I wish you luck.
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