Can I get out of a new home construction contract?
Manuel: I signed a real estate contract with a builder for a new home and I gave a $10,000 deposit down on the home. I am required to go to the builder’s design center and pick out the accouterments for the inside of the house. And so essentially I entered into a contract for the bones of the house without knowing exactly what the final price was going to be.
Attorney Tom Olsen: All right.
Manuel: And so now when I go to their design center and I see what the prices are of the things that they're doing to make the home at least comparable to what I had now, it just blows the budget completely out of the water.
Attorney Tom Olsen: Yes.
Manuel: My question is: How long do I have to back out of this contract to purchase a new construction home? Can I terminate the builder’s contract?
Attorney Tom Olsen: There is nothing within the Florida statutes that gives you a three-day right of rescission. There is nothing in the Florida law that's going to help you here. You only have a right to cancel the contract if the contract itself gives you that right. Now Manuel I have looked at plenty of new construction contracts over the years and guess what? They are all written for the benefit of your builder-developer, not for you. So Manuel, without even looking at your contract, I'm going to say there's a good chance you're not getting your $10,000 back. But if this is important to you, the only way for you to know is to sit down with an attorney ASAP and see if there's a way out of this contract.
Manuel: I noticed that within the contract they actually had a clause that says you wouldn't take them to court, that any disputes will be handled via arbitration.
Attorney Tom Olsen: Well that not good either, Manuel. So again, it's all written for their benefit not for yours. Now Manuel, you've looked at that contract, is there anything in the contract that may be a way for you to get out of it?
Manuel: No. There's really nothing spelled out, it's all very ambiguous.
Attorney Tom Olsen: Well, it's not ambiguous, Manuel, because how long is that contract? 10? 15? 20 pages?
Attorney Tom Olsen: Okay. So Manuel, I hear you about the finishes on your house, but I think that everything in there has a budget in it. Okay? Now they may have budgeted for Formica counters and you may want marble counters but that's up to you, Manuel, you got a contract and if you don't want to pay for marble counter tops, they will be glad to bill you for Formica counter tops.
Attorney Tom Olsen: So I'm sorry about that Manuel. Just out of curiosity, when you went to the sales, was there a heavy sales pitch put on you? I mean, were you caught up in the emotion of the minute, you might say?
Manuel: Without a doubt.
Attorney Tom Olsen: All right. So there's a little warning for all you people out there when you get in these new home sales offices, man, they know how to put the pressure on and get you to sign the contract right then and there. So be very careful about that and really think it through.