Frequently asked questions and answers.

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Rutter Homes can help you find that perfect lot/property for your dream home, if you’re not sure where to begin contact us today, we partner with the best real estate agents that can find you the perfect location for your dream home, if you have already purchased your property/lot Rutter Homes will help you begin the design process and you’ll be on your way to making your dream home a reality!
99.9% of future homeowners will need financing to build a home, you will need to talk with a bank or mortgage company in order to apply for a construction loan, they will determine based on your finances and other factors how much you will be approved for, in many instances they need a completed blue print and hard cost from a general contractor in order to get the home appraised, and the amount you get approved for is based off of the appraised value and the contractors cost, usually they choose to lend you 80% of the lower of the two numbers, there are other options/opportunities that come into plan as well such as FHA loans, Veterans Loans, etc.. 80% of the appraised value is just a general rule of thumb.
Have you purchased a lot/property? Rutter Homes partners with the best real estate agents in south Louisiana and can help you find the right property in the perfect location to build your dream house on, if you already own or have put a down payment on your property then the next step is finding the perfect plan/blueprint to fit on your property, Rutter Homes works with the best architects and designers all across south Louisiana and even some out of state designers, we guarantee to you find or design you the best plan possible, if you already have a plan and just need some help adding the finishing touches, let our years of experience go to work for you, we partner with the top interior designers that each bring their own unique styles and experience they will work with you to ensure your custom home is distinctive to your personality, contact Rutter Homes today to begin your exciting journey!
Construction Loans Are Like A Big Credit Card. The best way to think about a construction loan is to compare it to a giant credit card that only lasts until the home is built. At that point, you then get a mortgage for the house you've built, which will pay off the balance of your construction loan. A traditional home loan is a mortgage on an existing home, that generally lasts for 30-years at a fixed rate where the borrower makes principal and interest payments for the life of the loan, a construction loan is underwritten to last for only the length of time it takes to construct the home (about 12 months on average), and you are essentially given a line of credit up to a specified limit, and you submit “draw requests” to your lender, and only pay interest as you go. For example, if you have a $400,000 construction loan, you won’t have to start paying anything on it until your General contractor/ Builder submits a draw request (perhaps something like $25,000 to start) and then you’ll only pay the interest on the $25,000.
Experience, experience, experience!! There is no substitute for experience, anyone can pass a test and compile of list of subcontractors, then try and line them up for a project, lining up contractors is about 10% of the overall project, the other 90% involves experience, Ask the general contractors about their actual experience, Have they every physically done any work or ever been a subcontractor? How many years have they been a general? Do they actually know how build a house? You’re about to make the biggest investment of your life time, hire a general contractor with a wealth of knowledge and years of experience that has a proven track record and excellent reputation. Once you narrow down your potential general contractors you can search their experience by clicking on this link you can search by contractor name and look under “first issued” this will tell you what year the contractor was first licensed and give you an idea of how much experience they have at being a general, but then again anybody can pass a test so remember, knowledge is also key and true knowledge comes with years of experience, 10+ years of steady work is what it takes to be a well-rounded general contractor, put your trust in Rutter Homes and you’ll be just fine!!!
In the busy world we live in today it’s hard to find extra time to do anything but we try and tell our clients while you have any spare time or while your plans are being designed start to get ideas of cost for all allowances: (Flooring/Tile work, Bricks, Appliances, Countertops, Plumbing fixtures, Electric fixtures) allowance cost varies from contractor to contractor and it’s always good practice to do your homework of allowance cost before meeting with a contractor, this way you put all contractors bidding on your job on an even playing field and you will be better equipped to compare apples to apples, if you are able to hire an interior designer this is where their service can play a critical role, but if all of this seems exhausting and your worried, “ where will I find the time” don’t worry just contact Rutter Homes today we work the best designers and in many cases carry their fees in our overall construction cost!
We recommend a minimum of 10 years’ experience when hiring a contractor for a project of over 400,000, check on your contractors experience here - CLICK HERE
What is your time worth to you? Are you a professional at the trade you’re looking to replace? If you have the time, patience and expertise to do a trade than it is possible to save a little money but probably not as much as you think, take painting for instance, everyone thinks they can paint but painting is actually one of the hardest trades to master, it takes 10+ years to become a professional painter and there’s a lot more to it than slapping some new paint on the walls, if it’s not done by a professional you won’t have professional looking results, and even though on any given project 99% of people can’t see where corners were cut to save money, but an experienced custom builder can tell!! Some projects are better left to the pros, Rutter Homes can work with you to help save money without cutting corners talk with us today to find out how.

NO!! just like you wouldn’t attempt to build your own car, it’s a really bad idea to attempt to build your own custom home, unless you have significant expertise and experience in building custom homes we highly recommend hiring Rutter Homes instead, and that one friend or relative that attempted it and said they saved money is LYING!! And we know your mind set, you’ll just ride by our jobs and see the signs/advertisements of the guys we use, and then you will call them up and get a price, remember this: they aren’t charging you the same as their custom contractors!!, and why would they? Your one house every ten years won’t compare to the 100 homes they do a year with their custom contractors! But just in case you’re still planning on attempting it keep these following tidbits of information in mind:

Time Constraints - Be prepared to spend at least 35 hours a week for probably 8 -10 months working on the project, this is the calculated average for a 2000 sqft. of (Living) home. Does your current employer allow enough flexibility to spend this amount away from your job?

Selecting and scheduling the best subcontractors – Remember these subcontractors have other jobs in progress besides yours. Their loyalty may be with those builders that give them multiple jobs/work during the year (remember you build a house every 10 years on average, some builders build 10 homes a year) Will they be available to you at the proper time? For example do you have the toilet installed before or after the flooring is installed? One sub cannot do their work until another has completed theirs. Delays are costly, frequent and frustrating, keep in mind interest payments don’t wait for subcontractors to show up!

Bidding Expertise – Do you really know how to properly analyze a cost breakdown? Are you able to distinguish high bids from low bids and work quality? Are you allowing for all the materials you’ll need? Many times materials suppliers will have wrong quantities costing potentially thousands in cost overruns, many materials and commodities and cost fluctuate from week to week no material supplier can guaranty prices (if you find one let me know) and almost all material suppliers will have a disclaimer on the back of their quotes informing you that they are not responsible for cost fluctuations ** A mortgage lender will require that your cost breakdown be documented and if you don’t project cost accurately and run short of funds the loan amount can’t be adjusted after its approved ( generally speaking in 99% of cases). How do you know if subcontractors are charging you the correct rate? Just because you get three different prices for one trade and think the cheapest is the best, how do you know if the cheapest price isn’t higher than the going rate?

Technical Expertise – As the general contractor of the home, it will be your responsibility, to hire qualified, licensed, and insured subcontractors. Do you have the technical expertise to oversee if the work is done properly? If, after inspection, the work is rejected by Codes Enforcement who will absorb the cost to redo the work? While this work is being redone, time will be lost, and other subs may have to be rescheduled

OSHA (Occupational & Safety Health Administration) – As the general contractor of your home you can be held responsible for all sub-contractors who do not adhere to the construction site OSHA safety requirement. Specifics such as regulations involving stairways and ladders have been a major source of injuries among construction workers. OSHA has set out about 17 detailed rules that govern stairway and ladder use. Other OSHA standards for a job site include postings of emergency numbers and instructions in the event of an injury. If your job site became the target of an OSHA inspection, penalties for any infractions could be very costly, For example one jobsite home under construction resulted in over 20,000$ worth of citations.

Warranty Responsibilities – The New Home Warranty Act, effective August 30, 1986, requires builders of new homes to provide certain warranties that extend over periods of one, two or ten years depending on the nature of the defect. If you build your own home and sell it to another party, you will be responsible for claims brought on by subsequent owners of the home, if you are thinking of buying a home, DO NOT!!, buy a home from an individual that built their own home, make sure they can provide proper documentation proving a contractor built their home.

Licensing – A homeowner may build his own home one time per year, but remember you must actually occupy the home upon completion. Other than this exception, any person or firm who is the general contractor on any residential construction must be licensed when the total cost exceeds $50,000

Lien Laws – In the event any of your subcontractors fail to pay their suppliers or laborers, a lien can be filed against your property. A lien is a claim against a piece of property. These suppliers and laborers, if not paid, can file a lien against your property, even if you have paid the sub-contractors

Permits – Building permits and periodic inspections are required even if you are self-contracting. It can be a tedious and frustrating experience if you’re not familiar with the system and all of the “red tape” requirements which must be complied with before commencing work. Mistakes here can be costly and time-consuming

So if you’re still thinking of building your own just remember the A B C’s of building your own home:

A, Arranging Financing – Arranging and applying for a home loan can be quite involved and should be one of the first orders of business. Even if you feel you have enough cash to do the job, applying for a home loan to allow for inevitable overruns due to increased material and labor costs or upgrades is always advised. Most mortgage companies will not lend money to cover the unanticipated costs of a home on which construction has already begun. As a self-contractor, some lenders will not lend you more than 80% of the projected cost of your home. House plans, specifications and an itemized list of documented costs and bids must be provided to the lender. In calculating costs, do not allow for “sweat equity” as most lenders do not recognize this as a legitimate cost.

B, Bookkeeping Responsibilities – IRS: the IRS requires that you send any sub who earns $600.00 or more a 1099 form at the end of the year. In the event you are audited, be prepared to prove that the sub is an independent contractor – that is, you did not have to supervise his work and you did not dictate what time he reported to the job Tracking material purchases: It is very important to be on the site or have someone you can trust to document delivery slips. Returns must be accounted for since inaccurate billing can run up costs. You will need to check all invoices and account for all materials. Waste can add hundreds if not thousands of dollars to the cost of a home

C, Construction Management – Do not take this area for granted!! There is much more to building a home than meets the eye. Be realistic about your skill level and the amount of time you can spend on the jobsite. Base your decision to put “sweat equity” into your home on your experience, skills, available time and the amount of stress you and your spouse are able to manage. Your ability to handle long-term disruption of schedules is just as important as your ability to swing a hammer Also keep in mind: Deposits – Deposits will be required by all utilities before construction can begin. Make deposits early as some may take weeks to get their services connected Insurance – Do you know why builder carry builders risk, General Liability, and Workman’s compensation insurance on all of their building projects? Because they know what their liabilities are and you, as a self-contractor, will have to assume the same liabilities

In true custom home building there is no certain “standard” finishes per say because custom homes vary in size/square footage, budget, and detail. Homeowners are spending thousands of dollars on plans/blueprints that are seriously lacking in detail, where is the closet designs? What about pantry layout? What size moldings are you going with? What about interior door designs? Kitchen cabinet designs? Too often homeowners are left with plans missing key design details, and if a builder is only offering a few options for moldings, flooring, countertops, siding, roofing etc. they are production builders disguised as custom builders!!, don’t confuse the two, custom builders will typically provide allowances and work the homeowners to find the best products for the most affordable prices, Rutter homes works diligently with each client and the best designers to provide the appropriate options/finishes for the clients budget.
Bids fluctuate for many different reason: allowance cost, location, builder experience just to name a few. Allowance cost- allowances are a group of different items figured in the bid process that can fluctuate greatly in cost, the main allowances are, but not limited to: Flooring, Counter-tops, Electrical Fixtures, Plumbing Fixtures, Appliances and Bricks. Allowance pricing will vary from builder to builder, one builder may figure lower allowance cost than another to make their overall home price seem lower, if you’re not comparing one builders allowances to another’s than you aren’t comparing apples to apples, always make sure you check allowance cost in order to rule out this as a potential for bid cost fluctuation Location- home cost construction varies from parish to parish for many different reasons such as elevation requirements, local economy, market values etc.., if a builder is not experienced with working in a certain area than they are more likely to make a mistake in there bidding process. Builder Experience- new builders are hungry to make a name for themselves and get a product on the ground asap in order to start building a portfolio, this causes them to low ball or low bid their competition and make them seem like the better deal when in fact they are inexperienced and unseasoned to handle the project at your expense!! Unfortunately it’s easy to past the state test and become a “contractor” these days, make sure you hire a firm that has the experience of actually being a subcontractor has years of experience and knowledge and has had their state license for a minimum of ten years, Rutter Homes has worked as many different subcontractors before becoming a General Contractor, and has over 75 years of combined residential construction knowledge and has been licensed in the state for over a combined 50 years.
Every licensed builder in the state of Louisiana is required by law to provide homeowners with a signed copy of the New Home Warranty Act as a part of their signed contract in order to protect homeowner’s interest in their properties, if your builder does not provide this we strongly suggest you go with another builder and report them to the state licensing bureau of Louisiana. The warranty act provides homeowners the information about state require warranties, Rutter Homes provides clients with warranties for products used in the home (Roofing,A/C heaters, appliances, etc..) and also provides extended warranties for cosmetic damage all built in the cost of the home.