Modular Home Construction Loans

When you build your new modular home with us, it is important to understand how we help you to save so much money. The key to the savings we provide is that we eliminate the general contractor from your modular home construction project.

On a construction project, the general contractor (also commonly referred to as a “builder”) is basically the project coordinator. In some cases, they also do some of the actual work on the project. But, often, they simply work to coordinate the “subcontractors” involved in your project. General contractors earn their profits in 3 basic ways:

1. Mark-up on materials – For example, they may get the home unit out of the factory at a cost of $120,000 to them, and present it to you at a price of $160,000. The amount of the mark-up varies based on the builder, and your local market. If construction in your area is expensive, the mark-up on your modular home is likely to be greater.

2. Mark-up on subcontracted labor – Here again, the general contractor is buying something at one price, and “re-selling” it to you at a higher price for a profit. In this case, it is the labor of the subcontractors. You pay the builder to do the project, he then hires subcontractors to actually do the work on the house. Of course, the general contractor keeps a percentage of the money you paid him as part of his profits. This doesn’t necessarily make him a bad guy, or a crook, this is how they earn their money. However, some builders do take advantage, and build tremendous profits into their projects.

3. A Builder Fee – This is often misunderstood by the consumer to be the only cost the builder adds to the project. This fee, also commonly referred to as a project management fee, will vary from builder to builder and project to project. But, it is very rarely the only cost the builder adds. In almost all cases, the builder is making a margin on both materials and labor.