Risk Factors

• The interim loan or draw schedule progress payment method is ideal for the investor/owner. The reason is that we, the Builder, are basically using our capital to complete the draw and only after approval and satisfactory work is completed, are we reimbursed for our expenditures and profit. 

• At any time during the build, the owner can terminate our services for contract default and the owner is not out any funds for that draw. This enables the owner to pick-up another GC and start from that point with no outlay of cash lost because the builder always works out of internal revenue and then receives reimbursement.

• The progress payment method ensures that we, the Builder, must do satisfactory work and complete it in order to be compensated. This is the very reason that banks and lenders utilize this method for protection against non-conforming builders.

• We, as Builders, understand this and it is why we must have all planning in place and build at quality levels within codes in order to make a profit.

• The closing sales price is a crucial factor that will determine profit. All project cost and projections are based on current conditions.

• The length of time that the property sits on the open market will also be a factor on carrying cost that includes debt service, taxes and capital resource availability.