ILLINOIS MECHANICS LIENS / COVID-19

Single Family Residential

Your Home – Your Largest Investment

While Jeremy focuses mostly on commercial projects, he also helps families design and build high-end single family residential projects. Homebuilding is much riskier than most people understand.

Pick the Right Contractor

There are many great homebuilders in the Chicagoland area. Many take pride in delivering high quality construction for a fair price. Quality homes are often developed without incident by honest builders who return willingly, at their own expense, to solve problems years after families move into their homes. Selecting the right contractor is half the battle.

Have A Good Contract

But even if you pick an excellent contractor, treating construction contracts as an afterthought – and blindly signing whatever paperwork the homebuilder creates – is not a winning strategy for homeowners who seek predictability and met expectations. People who build homes with lousy contracts invite hundreds of thousands of dollars of losses.  

Walk a Mile in the Contractor’s Shoes

Developing a great relationship with your contractor starts with understanding their many challenges. Most involve money – the lifeblood of every construction project. Contractors often perform work in month one, and get paid in month two (or later). They essentially extend credit, a risky proposition. Contractors must also keep their equipment and workers constantly busy and earning money. This forces contractors, even the best and most honest ones, to look ahead and pursue their next projects.  

Understand Your Risk of “Paying Twice”

The point of all this? Even the most reputable homebuilders can get into financial trouble, using funds from one project to keep another project moving, with disastrous consequences to families. Some disreputable contractors make a practice of using one homeowner’s money on other projects. This might not shock people. But most people would be shocked to learn they can be forced to pay for the same work twice if their contractor does not – or cannot – pay its workers, suppliers, and subcontractors. These vendors can bring claims of non-payment directly against the homeowner, often with success, even if the owner has a legitimate dispute with the contractor who hired them.

Know Your Rights

Fortunately, Illinois law strongly favors homeowners – but only those homeowners who understand their obligations under various laws, including the complex Illinois Mechanics Lien Act. Each month, and with every payment of every dollar to a contractor, Illinois law requires homeowners to collect certain sworn accounting statements and claim waivers from the contractor and its subcontractors. The law requires them to supply this paperwork upon your request. It also requires you to make the request. People who understand the law can protect themselves. Sadly, few homeowners understand what Illinois law demands.  Most people are novice consumers of design and construction services. They run financial risks that are both dire and unnecessary.

Mitigating These Risks, Simply

Smart contracts – and project structuring – can spare the homeowner from most of these risks. Even simple construction projects involve designers and builders with highly specialized roles. Careful decision-making and coordination is essential. Design and construction projects require specialized insurance coverage. Typical homeowners insurance policies usually will not cover a home destroyed during a construction project. Who will buy the insurance, in which amounts and for which coverages, is an often overlooked decision.

Select the Architect Carefully  

Whether the owner or contractor will hire the architect is among the most important decisions an owner can make. In commercial projects, owners hire architects to monitor the quality of ongoing construction, to certify how much money a contractor should be paid each month, and to keep the owner reasonably informed. This is common on single family residential projects too. It is also common for homeowners to allow the contractor to hire the architect, which is called the “design-build” method of project delivery. This popular project delivery method has advantages and disadvantages.  

Smart homeowners carefully weigh the pros and cons of the various delivery methods. They make informed decisions on how to structure their project. Unfortunately, people often cede too much discretion to the homebuilder when it comes to the architect’s role.     

Promoting “Win-Win” Outcomes 

A happy contractor is the homeowner’s best asset. Jeremy strives to structure projects wisely, to negotiate fair and reasonable contracts, to proactively avert disputes, and to achieve “win-win” outcomes. Jeremy does not view the owner-contractor relationship as zero-sum, and never tries to hurt or squeeze contractors. He aims to be the most reasonable person in the room. With his design and construction knowledge and experience, he can help homeowners and homebuilders complete successful single family residential projects. 

To learn more, contact Baker Law today.

Jeremy S. Baker help Illinois homeowners and homebuilders design, construct, and complete high-end single family residential projects.

Jeremy helps Illinois homeowners and homebuilders design, construct, and complete high-end single family residential projects.