Any help is greatly appreciated!!!
We’ve gotten bids back from potential GCs but of course the bids have generated a lot of questions. YOur insight into these questions would be very much appreciated.
- what is the standard payment flow? the subs bill the GC who then bills us. we make the payment to the GC who in turn keeps his cut and passes the remainder on to the sub?
- should it be problem for the GC to give us copies of the actual Sub-contractors recepits? I know what the GC’s “plus” is so i would cut the GC a check for the subs bill plus his “plus”. why should this be a problem? Honestly, this part smells fishy to me. I’m trying to avoid paying for the bid amount when the actual work is less, etc.
- as a follow up to the last point, is there anyway i can get screwed even by getting copies of the actual recipets? is there a better way?
- all bids are cost-plus with the last line item the “plus”, but each bid also contains a line item called “misc supervision” or “managment”? what’s going on with that?
- bids obviously include the sales tax, but i’m amazed that all the GCs are charging their “plus” on the sales tax. the best respons i’ve gotten so far is “that’s the way it is”.
thanks again for your help!
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EricPaulson | | #17Good reply Sam.
>>You are the MathMan, figure it out. 1500 (minimum) receipts with sales tax, 5 minutes (also minimum) each to break out the tax and recompute the invoice. $45.00/hour (again minimum) cost for the bookkeeper + 20% profit. Vs: 1/3 of the contract cost of your home x 7% x 20%. It is close enough to a wash that nobody wants to take the time to deal with those 1500 receipts let alone convincing 50 to 100 subs to do it too.
Re: the red print, are you suggesting that 1/3 of the cost of the house is what??
Materials and subs? You lost me on that part, but the point is well made.
EricEvery once in a while, something goes right!
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mathman6 | | #18come on folks,
I've said this in at least three different places in this post, i am willing to pay a GC for their experience and i acknowledge that i don't have the experience to do this myself. I've also said i don't have a problem with paying the $, i just want to be sure I'm treated fairly. Finally, if by holding someone to a fair and equitable agreement means i'm a ball buster, you're wrong...it would have to mean I'M A BIGGGGG BALL BUSTER!!!!
But you can't seriously suggest that i just roll over and accpet everything i'm told because "i have to trust the man". Remember, Trust but Verfiy especially when i'm looking to spend over $300k.
Sorry, but if you're trying to convience me that making copies of receipts is that time consuming and it is too difficult to keep track of all the "little" things (remember a bunch of little things add up to one big thing) then i don't want you building my house. you're not paying enough attention to the details. By the way, i'm very comfortable that each builder i've refered to is extremely detailed orentated and would do a great job on my house. In fact, i trust these guys enough to ask them to bid but trust doesn't mean blind trust. Geez, some of you guys can't be neive enough to think that just because you're building a house you should be held to a different (lower) standard than anyone else??
additionally, these are the same builders that have told me that fee (the "plus") covers their work and efforts. so when they show me their fee AND an addition "management fee" I, like i think most of you, would beging to wonder what the "plus" actually covers and you would naturally ask the question. All i'm looking for is an explanation. In fact, if one of the builders took offence at the fact i'm asking the question, i promise you they're not building my house. How do you say that the "plus" covers all your work then add an additional managment fee and not expect to be questioned on it? If the explanation is reasonable then great lets move on and no big deal, but if you come up with some half a** explanation i know i can't trust you and all you wanted to do was build in some extra profit and hoped i wouldn't call you on it.
Maybe someone can explain why not just up the plus and leave out the addition fee? if the amount paid comes out to be the same then why not just add a bigger "plus"? the positive to that is that it doesn't leave it open for some to feel like you're trying to take advantage of them.
Finally, i'm really surprised to see how many of you expect builders to want to do fixed fee, every builder i talked to said there is no way they would consider a fixed fee deal. In fact, some wouldn't even bother with an interview if that was the type of contract i was looking for.
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SamT | | #22FireBird,
1/3 value of house is a ballpark for taxable receipts.
Mathman,
>>I've also said i don't have a problem with paying the $, i just want to be sure I'm treated fairly. Finally, if by holding someone to a fair and equitable agreement means i'm a ball buster, you're wrong...it would have to mean I'M A BIGGGGG BALL BUSTER!!!!
All of your questions here have been answered as why the practices are fair and equitable. You don't want to hear it. You want to nitpick pennies even when it has been explained that it will cost dollars to comply with your penny pinching attitude.
BTW, I did a quick calc on the numbers saved for a 320k or 360k, (don't remember,) house using the figures I suggested. At 7% sales tax you "save" $700 (1.9% of total) and pisss off everybody who is doing business with you. And that is using the minimum charges for recalcing your tax savings. If the accountants cost is just $4 higher than my guess, you lose money. It would take a bookkeeper over three weeks (125 hrs) just to figure your sales tax.
Now I can see where you may not care if they're upset, after all it just fair and equitable business, right?
Do you really want someone who hates your guts 'cuz of your meaness working on your dream?!?!?!?
On a different note, why are you so suspicious of the 2 contractors your archy reccommended? Maybe you should listen to whatever is causing your squeemishness and find someone different. Something is definately holding you back, and we here have no way of knowing if the face you present here is your everday face or one that is caused by something going on with the 2 contractors.
Best of luck and may it work out best for everybody,
SamT
Arguing with a Breaktimer is like mud-wrestling a pig -- Sooner or later you find out the pig loves it. Andy Engel
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FNbenthayer | | #23More than ever, I get the feeling that this is a "two story" house ;>)
Any time you enter a relationship lie this, it has to be built on trust and continue to be oiled by respect
I do a lot of cost plus work on jobs up to and over a quarter milion dollars. any time the custokmer wants to see verification of the actuall "cost" all they have to do is ask. I do not typically include copies of every invoice simply because that is time consuming and not something most of the customers want. I started out doing this and found most customers saying, "Don't bother me with all that - just itemize the bill and I'll pay it."
Charges for misc management are valid. if it were not a line item, the percentage of his "plus"" markup would be higher to cover it. some items take a lot more management than others, so it is reasonable to keep it separated.
do I charge the plus fee for amt of sales tax?
You bet!
I have to pay it out, spend time accounting for it, and wait for the money to come back in from you. Money costs money, and time does too. When I bill you, I expect to have the money in mmy hands within ten days. Any more and it starts to hurt both me and the job flow.
Somebody mentioned detailed plans?
If they are that detailed, why would you need to ask the contractor what kind of tile he is planning for that 20K? it's the same kind that is detailed in the plans, of course.
Maybe you are dealing with crooks and maybe not. The fgood refs from the archy tells you probably they are OK. It is a matter of ethics for the archy to watch out for your money for you so if he were part of some scheme to hoist you up and roll you, he would have some answering to do. Seems to me that you should bne speaking to him about all these concerns. That is what you are paying him for.
The way this whole saga reads, it sounds like the plans are a bit haphazard, so some fudge factor is buiilt into these estimates. If I were doing that, I might also be unwilling to answer detailed questions, because it is your job and the archy's to spell out thoise details, but if you hire me as a design/build firm, then I do that bit of detailing too.
so the short answer is that yes you have a right to see evidence of what the actual cost is in any cost plus contract until they build trusting relationship with you, but you should improve the quality of respect you show the people you are dealing with in order to build trust from your end
Welcome to the
Taunton University of Knowledge FHB Campus at Breaktime.
where ...
Excellence is its own reward!
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mathman6 | | #21
piffin,
thank you for the explanation on the plus on top of the taxes. i get it now and have no problem with it. I wish the builders would have said the same thing or at least went into the detail you did. Again, thank you.
In Washington state it is illegal for the archy to take a referral fee from the builder (at least that is what i was told), plus i know the archy as he is the brother of a friend and actually well known in the industry. Frankly, you spend the amount of time with him as we did and you'd trust his opinion like we do.
Honestly, i have a good deal of respect and trust for the GCs we asked to build. That being said, i haven't spent the same amount of time with them as i have with my brother or my archy so they don't get the same level of respect or trust, but i'm sure that will only increase with time.
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Cole | | #25First of all, cost + is a tough way to build much, especially a house, and have everyone feel good about it. It protects the GC by covering his butt where he may have screwed up somewhere, but the paperwork is key. If it is truly a cost + deal then you are entitled to see all of the costs, but I damn sure would be showing you marked up sub costs. It ain't free to schedule, supervise, pay, and keep track of insurance on them. This is part of the deal, if you think your getting the shaft because a GC is marking up his subs, then you need to GC the job yourself. Then you can see the raw costs from the subs, but if you hire them on a cost + basis, they will surely profit from any work, extra or not they do.
I give fixed bids for every job that I do and a narrow schedule for commencement. If material prices increase prior to that date, I ask the client to cover the costs, ( there are provisions in my proposals to cover this ). If I have to put the job off for a while due to my own issues, I in no way expect to be covered for this. I'll order the material ahead.
If a project is taking longer than I bid, then it is my problem, but if it goes faster, then good for me, I make more money. But if I'm opening my books to anyone, then I sure as hell am not going to lose a dime anywhere. It is nobody's business what my margins are, so if they think they're privy to that, then they can see what I want them to. I would not even think it unethical to not show subs invoices, if you don't trust the GC to hire the subs, then you should be hiring them. Running subs is tough.
This is just my view on things, and very well could be wrong. But I just walked in from my 14 hour day, and more or less defending myself, and every other contractor out there just does not sit well. Granted, some are indefensible, but I don't think you'll find them in here. Please take no offense. Your cost plus contract should have VERY clear terms regarding markup, profit and the means to account for all of the costs. If it does, you don't need answers here, you need to decide if you can let this GC build your house fairly, or if you need to monitor this yourself. If so, welcome to our world, it is lots of fun, but it is indeed a full time job.
Good Luck
Cole
Cole Dean
Dean Contracting
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junkhound | | #26Mathman6: Take the following with a grain of salt from someone who got hammered about 1 out of 3 posts for the first 50 posts or so -- this is my take on your quandry based on this quote, and not at all facetious, though some may think so. Also, into my second screwdriver this evening after 4 hours of welding on the track loader after the 8 YO grandadaughter dropped a 7 ton log on the front cowl of it (she was VERY well protected, teaching her heavy equipment early)
the quote, the most feeble of excuses
" i don't have the experience to do this myself"
uh, duh.
1. OK, are you too lazy; or, do you go to the ball game or strip joint vs. swinging or nailing some real wood?
2. Is your IQ under 110 (or 80, or 140, a debateable number, e.g. Boss Hog's IQ for wood must be >200) -- if over, you are easily able to learn to figure out structures.
3. EVERYBODY here built a FIRST something. Some of us at age 2, others not till in their 20's, maybe some even later.
4. Do you pull down over $100 an hour on average? If not, then DIY is a bargain considering the experience gained. If you do pull down mucho$$$, then why the complaining, you're obviously being trusted by someone for that $$.
5. If you are a lawyer, there is no hope, nothing above applies and certainly no offense or political incorrectness implied, ------- (certain building inspectors on this site who were lawyers in former lives are exempted from this comment )
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mathman6 | | #27
Junkhound,
thank you for the advice. I think my IQ is high enough but lets face it I don't know all the ins and outs and that's what i'm willing to pay for. Time is the other issue, two small kids and a job that makes me travel don't make it easy. The fireman that lives next door was his own GC but he works 48 hours and is off the next 48 so he had some spare time on his hands.
glad to hear you granddaughter is OK.
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mathman6 | | #28
To everyone with helpful advice, thank you.
to the few that felt the need to attack me personally, thank you. I say thank you because you confirmed for me that you are the type of bozos I'm sure would screw someone in a NY second and that's exactly who i'm trying to protect myself from.
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gdavis62 | | #29
Others have said this, but I will repeat it. You've said that your plans and specs are quite detailed. If this is true, and the scope is in black and white, with little or nothing coming in the future in the way of design or product decisions, then insist on a lump sum price. If your builders are scared of the way building material pricing is moving, then get them to add a material price movement clause that protects them if costs go up, and gives you money back if they go down.
Your payout schedule (if it is a new home) would be something like this. Four progress payments, one each at the end of these stages: foundation built, capped, and backfilled, then full enclosure and dry-in, then drywall all complete, and finally, finish. It is not four equal quarters, it depends on how your builder details out the schedule of values. In expensive houses with huge millwork and cabinetry packages, often a draw requirement is inserted, between drywall and finish, when all that material is completely delivered.
Everyone will sleep better under this arrangement.
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xMikeSmith | | #24
math... i've done a lot of Cost Plus.. i try to avoid it now.. it's generally a money loser..
i prefer to bid fixed fee Proposal.. in a volatile lumber market like this i'd just put an escalator clause in to cover both of us..
everyone that has posted a response to you has said the same thing... if you can't trust your contractor, don't hire him..
check the references.. these guys didn't just fall out of the sky... they have a history.. check them out with previous customers.. the child is prelude to the man...
anyways.. you've been around BT for a long time now.. why should any of this be a surprise to you.. don't you read the business section threads ?Mike Smith Rhode Island : Design / Build / Repair / Restore
Are you getting a construction loan or disbursing the construction funds through a 3rd party, such as a title company? If you are, either the bank or the title company should get a copy of all invoices they pay out on. Just get your copies from them.
You are entitled to copies of bills/invoices on a cost plus contract. Why wouldn't you be? Now, if you entered into a fixed price contract, and started wanting to see the bills, I would understand the contractor's hesitance to provide them, and understand the conflicting opinions here. To me, it's good business to not only ask for them, but to provide them. Trust is earned, right? What has either one of you done to earn the other's trust????
How much extra work is it for the GC to put all unpaid/unreimbursed invoices in a file, then run them through the copier and provide a copy to the homeowner? Chances are, if they're organized, they're making a copy of them anyway so they're all the same size, then putting them in a file or a binder or something. If it's that big of a deal, sounds like they need to get into a new line of work.
Replies
hope u have your flak jacket and helmut on.
the wording u used in this post is sure to draw fire.
you appear to have the feeling you're going to get screwed.
it doesn't come across as looking for understanding
from your profile u've been a bt'er for a long time
have u been reading the business section posts?
_____________________________
bobl Volo, non valeo
We'll if it comes across like i'm trying to keep from getting screwed that's because I am.
The difference in price between the highest and lowest bid so far is well over $80k or more than 25%. both bids from GCs recommended from the architect and both highly thought of. the specs were very detailed (e.g. no difference in material) so the difference is somewhere else and you darn tooten i'm going to be a little concerned when i see that big of a difference for the same work. Lets face it, everyone, including GCs and myself, are here to make a buck and if i can make a buck more from you then i'm going to do it. Just like everything else in real life, not everyone is honest and trust worthy so i don't see what's wrong with "Trust but Verify". All i'm trying to do is get educated, i'm not asking the GC to "sharpen their pencil", i'm comfortable paying the price they ask as long as i know i haven't given them a blank check. Another example is one of the other bids, they added $20k for tile work but when i asked for how much material and what type of material was in that bid, he couldn't give me an answer. in other words he pulled a number out of the air and if i was crazy enough to agree to it then so be it. Your darn right i'm trying to keep from getting screwed, every dollar i spend that i didn't need to is a dollar i don't have for my daughters and i'd rather spend it on them than give it away unnecessarily.
Why do you want to buy a job in that price range on a cost-plus basis? If the specs are so detailed then a decent contractor should be able to offer a fixed price contract. If they're smart, that's what they'll do as it's usually more profitable.
Excellent question,
All the GCs that have bid said they don't want to do fixed bid because of the volatility in lumber prices. I still haven't worked out how we're going to get past the cost-plus issue when it comes to financing given that all the banks i've talked to say they only lend on fixed contracts.
as a follow up
i just want to make it clear that i am not trying to get over on the GC. I'm more than willing to pay for their services, i'm willing to pay top dollar (within my budget) for top knowledge and service, i have no problem with the GC making a good living, etc. but just becuase i'm not out to screw someone it doesn't mean someone isn't out to screw me and there is no way in hell i'm going to let that happen, hence my questions
Take it from someone who has been on both sides of the equation... go with the contractor that you are the most comfortable with and that most espouses the core philosophies that you do. Sure, costs are important. But the best way to cut costs, and still maintain quality, is to develop a level of communication that is the same as the communication level that you have with your spouse (ok, bad example... but you get the idea!).
If you are a tightwad (not meant derogatory, just as an illustration), then go with the contractor that espouses how much money he will save you.
If you are a quality nut... then go with the contractor that espouses the types of materials he will be using and the quality of his workmen.
If you try to be a tightwad with a quality contractor... you will have nothing but frustration. In reverse, if you try to get quality from a contractor who is always looking for $$ savings... the same level of frustration will occur. In the end, frustration leads to more expense than anything that you have asked here.
Now, a question for you. Did you pay for your quotation or did you get it for free? The reason I ask... if you want "value engineering" in your initial bid, you are gonna have to pay for it. A contractor who offers value engineering will save you thousands and thousands of $$ over the long haul. If you ask the contractor what his rate is for value engineering... and he looks like a deer in headlights... you need another contractor. The relative small cost of value engineering is an investment that pays huge dividends.
The cash flow of a contractor is subject to 50 different types of interpretation. Some make $$ on the materials and the "plus". Some are more expensive on the supervision, but directly pass along the sub expenses. Some do a hybrid... marking up some things, while not marking up others. So asking this type of question is like asking a group of school kids what flavor of ice cream is best.
Advice for ya. If you want to see every little invoice and cost of every screw and nail... you are gonna get taken to the cleaners. A contractor who will take the time to go over each of these details in minutia will also charge you for the time it takes to assemble the info. They will provide you with expense reports that detail every last trip to Lowe's. They will provide you with every receipt for every nail that is used on the job. And best yet... they will provide you with every excuse in the world as to why you should pay for the "executive porta-pot" rather than the "one-holer" (actually happened to me).
Bottom line. Go with the contractor that YOU are most comfortable with and who is most like you in philosophy. In the end, the communication that is generated from that type of relationship will save you thousands.
applause............
carpenter in transition
It sounds as if you want to be the GC. <rolleyes>
If your bid is returning with conditions that you can't understand or refuse to accept, look to RFP that was sent out.
I've done small (under 3k) jobs cost+ never heard of bidding a house that way.
As for subs and their invoices, they work for the GC not you.
I think this thread might help
http://forums.taunton.com/tp-breaktime/messages?msg=43397.1
the topic of cost+ comes up every once in awhile_____________________________
bobl Volo, non valeo
i'd don't get the hostility toward my questions. am i suppose to accept what someone tells me is the cost and not question it? If so, i have a car, some land, a trip to space, etc that i would like to sale you. yes, i get the point that the subs work for the GC, but the fact is the subs are being paid with my money and i am charged a percentage on top of the subs costs. you're asking me to take someone's word on the cost and not question it? shouldn't i understand where the money is going? if its a cost plus contract (which is what the builders want) but i'm given just the bids with the "plus" added on, but the actuall cost is less why shouldn't i pay less? doesn't that negate the idea of COST plus, cost doesn't necessarily equal the bid amount. if the GC wants to make more $, fine no problems. just show me the actuall costs and then add a higher "plus" i have no problems with that. at least then i know what i'm actually paying for and thats all i'm asking for, the truth nothing more nothing less.
Ah, the joy of DIY.
You're absolutely right- if you're entering a true "cost plus" contract, you should see all the invoices, with the GC's percentage added on. Every month, we assemble billings from all the subs, create one bill for the owner with the sub bills as backup (along with an accounting for our general conditions), and submit it for payment. I don't know why your contractors wouldn't want to do this, unless they don't truly understand the concept of cost-plus contracting.
A few points:
- You asked about the line items for "misc supervision", etc. This is the GC's line item for his time on the job. Some contractors roll that into their fee (the "plus"), others do it as direct work, with the "plus" being for general overhead and profit.
- You called the contractors' proposals "bids" several times. If this is truly a cost-plus job, I wouldn't look to them as "bids", as much as "estimates" in the true sense of the word. None of the "bid" amounts are cast in stone- the actual direct work cost will be what it will be- the "low" bidder could end up being the highest at the end of the job based on what you end up building. Better to compare fee percentages and go with the contractor you're most comfortable with, rather than look at the total numbers, since they're about meaningless in a cost-plus scenario.
- As someone else stated, if your plans are that detailed, the job should just go lump-sum- save yourself the heartache of cost-plus. If lumber costs are truly a concern, get a lump-sum price with a breakout for the lumber cost. Then allow the contractor to submit actual costs for lumber if it escalates. At least then you'd have 90-95% of the price locked in, and only have a risk on the lumber price.
Bob
What you don't seem to understand is that the definition of "cost plus" is as wide ranging as there are contractors.
If you find a contractor that is willing to provide you with all of this... are you willing to pay the cost of the contractor to assemble all of the info?
If you got all of the bills... would you know what you are looking at (again, not deragatory... a simple question of your ability to decipher what you are looking at)?
If you are not comfortable with the "cost plus" method... then continue to look for contractors that do not bid that way.
BTW... if both contractors were referred by your architect.. have you asked if there is a "referral fee" paid to the architect? You may want to take into account the fact that a builder who is referred by an architect is much less likely to criticize material recommendations than a contractor who has no ties to the architect. Note... there is ABSOLUTELY nothing wrong with getting a referral from an architect or with builders and architects working together. However, my experience has been that a referral from an architect does not always yield the best critique... and certainly doesn't always yield best costs.
There was a line from a movie... can't remember the name of it right now. You say that you want the truth... "well, you can't handle the truth". My guess is that if you were presented with all of the materials involved in a large building project that you would wonder how the builder is able to keep track of it.
FWIW... I used to be a micro manager. I know exactly what you are thinking. I wanted to see EVERYTHING. When I did an analysis afterwards... I added 10% to the cost of my project by doing this. My contractor was VERY honest... and he billed me for every single hour that he and his staff spent explaining and assembling all of the stuff. Not very cost effective.
Keep in mind... you are hiring a GC to build your project; to your specifications; on time. You are paying for his expertise in this area. If you want to be the GC... go for it. Pay someone to teach you the fifteen yrs worth of information and nuances that are required for you to be proficient.
Otherwise, hire your contractor and work WITH him to get the end result that you seek. You have already gotten yourself all worked up over something that you haven't confronted yet. You base this on the fact that the two bids are so far apart. Well, news for ya... I will take it 10-1 that if both builders were to build the same project... they will both come within 5% of each other in the final analysis.
One other thing. Have you had an "as built" appraisal done yet? If this appraisal is accurate (I always suggest getting at least two appraisals from INDEPENDENT (read as "not affiliated with bank") sources) it can a very valuable resource. If the appraisal says the project should be "x"... that is a pretty good place to start when evaluating bids/estimates.
Edited 7/27/2004 3:59 pm ET by Rich
but the actuall cost is less why shouldn't i pay less?
Not per se. Two people buy identical cars off the same dealers lot--the individual deals will be as different as teh buyers (one has a complicated trade in; the other is not using in-house financing, what have you).
Houses are much more unique than cars.
Back in the day there were cost-plus-benefit contracts. That stipulated when an actual cost was less than the allowance, the two parties split the difference by some ratio. It's actually better for gc-to-sub contracts where the accounting is simpler (relatively). It get almost unworkable whenever a CO gets used, as it virtually has to be "booked" entirely separately.
It gets pretty unworkable in residential work, though. Say the contract does not speel out anything for cabinets other than $20,000 as an allowance. That's fine and dandy untill the cabinet shop gets the base price down to $15,000 but offers an upgrade that's $4000, and also changes the counter tops by $1500 more. Now what do you do? Do you book the $5K savings and take the 50/50 split, then charge the $5500 as an extra? Or do you book the $100 savings, and eat the $1500 as a change order? While we are deciding that, the plumber was hit with a 17% increas in cost for his PVC . . . Occupational hazard of my occupation not being around (sorry Bubba)
I am going to tell you something up front that you are not going to like. From the tone of your posts you come across as confrontational, defensive and down right HOSTILE.
Q) should it be problem for the GC to give us copies of the actual Sub-contractors recepits? I know what the GC's "plus" is so i would cut the GC a check for the subs bill plus his "plus". why should this be a problem? Honestly, this part smells fishy to me. I'm trying to avoid paying for the bid amount when the actual work is less, etc.
A) You are allready displaying the fact that you don't trust this person. Why on earth would you allow them (or pay them) to build a home for you???? Frankly, the last sentence makes no sense at all. What I hear you saying is that you can't trust this guy to hire and pay the subs, you don't want to pay some one to do it, and inspite of the fact that you believe that you are more of an expert at this than the GC, you are unwilling to do it yourself.
You need to find a builder to do this project for a fixed price. It will be difficult however with your attitude. After a 10 minute conversation with you, most GC's have put a big stamp on your forehead that says "Ball Breaker". I'm not gonna die on a fixed price contract with this guy.
Don't get me wrong, I am not picking on you, but your demeanor. You are obviously amped up, and somehow think that you can drive this boat. Well then, why do you need a GC? If you would calm down long enough to let someone else do the talking and the thinking, you will find an honest gentleman who will bid your project provided you know what you want or are willing to pay for changes and or evaluations as the job progresses. Then you can get the financing you need!
As a point, if you are so detailed about this project, why couldn't you take a moment to proofread your initial post?
Calm down, you seem very angry.
BTW Lumber and building materials are mostly coming down in price currently. Why not have a conversation about this with the GC and see what is it that would make you both comfortable in order that he doesn't get burn't by a spike in prices on materials?
Good luck,
Eric
Edited 7/27/2004 4:24 pm ET by firebird
MathMan, you come across as one angry and paranoid dude. That's probably why you get some hostility in some of the answers here.
The GC pays his expenses as needed. He bills you according to the draw schedule. the two are not nescessarily related. In some states it is illegal for the GC to make the subs wait til he is paid.
The GC probably doesn't see any subs' reciepts. He may be just paying the contracted amount. If the GC smells to you, hire a different one, because you HAVE TO TRUST the man somewhere.
A] Absolutely. B] DIY. There is always a risk in using your judgement about who to trust.
Ima Theef/Ura Sukor Homebuilders has contracted to build your new home. They have to pay somebody to supervise the people on the site and manage the work flow and the subsidiary contracts involved in building your home. They need to make a profit off that manager/supervisors time they are selling to you if they're going to stay in business long enough to honor any warentee work (10 years).
You are the MathMan, figure it out. 1500 (minimum) receipts with sales tax, 5 minutes (also minimum) each to break out the tax and recompute the invoice. $45.00/hour (again minimum) cost for the bookkeeper + 20% profit. Vs: 1/3 of the contract cost of your home x 7% x 20%. It is close enough to a wash that nobody wants to take the time to deal with those 1500 receipts let alone convincing 50 to 100 subs to do it too.
Hope this helps,
SamT
Edit: the previous four guys posted while I was typing. ST
Edited 7/27/2004 4:25 pm ET by SamT