The modular home building process gives home buyers a low risk alternative to obtaining their dream home, while also potentially saving thousands of dollars. If you are new to construction or just want to better understand the process of building a modular home, we have provided an easy to follow step-by-step description of the process below.
Our comprehensive construction manual provides details for the complete modular home building process. It is provided free when you purchase your home.
“Self-contracting” involves hiring professionals (subcontractors or “subs”) to actually do the majority of the labor. Your job is basically a general contractor who coordinates just about everything to do with building the house. This requires people skills and good organization. It helps to have an understanding of the basic work being done by the subcontractors. During this process, Express Modular is just a phone call or email away. We are here to make your project successful!
Working With Your Lender
Selecting a lender is the first and most important order of business. To avoid extra fees, choose a financial institution that can provide both a construction loan and a mortgage. Also, find a lender who has experience working with self-contractors, unless you decide to use a general contractor.
First, you’ll need to be pre-approved for a standard “end” mortgage before talking about a construction loan. Once that’s done, the construction loan process can begin.
NOTE: Remember, the lender is the expert and it’s your job to listen and ask questions. If the lender suggests adding an extra 3% or 4% to the total amount or going with a 1-year loan instead of a 90-day loan, it’s probably a good idea.
The first item you’ll complete is a sworn construction statement. It’s an itemized breakdown of what it will cost to build your house including actual bids from subs and suppliers for every bit of labor and specific materials going into the house. This is what the lender needs to make sure you can actually build the house for the amount of money you want to borrow.
How The Loan Works
After the lender approves an application, the construction loan is finalized. Do you walk away with the cash? No, the money stays with the lender, and is only drawn out as needed during construction to pay off subcontractors and suppliers. You only pay interest on the amount that has been drawn out during the construction process.
A self-contractor never actually sees the money. The lender may assign a title company to verify the work, collect lien waivers, and pay the bills or they may issue checks directly to the to the subcontractor with your approval. This process usually depends on the regulations of the state you are living in and the policies of the lenders.
Your Role As Contractor
As contractor, you’ll have to do your part and come through on things like materials and schedules. The modular home building process allows you to move forward rapidly with the scheduling of subcontractors. In fact, much of the speed of modular construction, both onsite and offsite, is the ability to have multiple tasks taking place simultaneously.
Primarily, it’s your job as contractor to make sure materials get to the site on time, that subcontractors are scheduled in the correct order, that work is done properly, and that everyone stays on schedule and knows about any changes.
As a self-contractor, you’ll deal with many people: bankers, attorneys, subcontractors, insurance agents, etc. Building your home goes much smoother if you’re able to communicate and work well with each person.
Most first-time home buyers acting as the contractor are eager to start building right away. But this is where the real legwork begins so the whole building process will go smoothly.
Finding A Site
There are a few key items to think about when buying a site for new homes construction. For proper drainage, the house shouldn’t be in a low spot or at the bottom of a hill where runoff will head. Each piece of property has easements that dictate where utility lines can go. Easements and lot restrictions will also influence the actual location of the house.
Does the lot you are looking at have public utilities? If so, learn about any connection or tap fees that have to be paid. Coordinate to have the taps installed according to your water or sewer commission or board. If it is a rural site, does the land have the ability to have a septic system installed? If so, what type? There is large variation in prices of septic systems. Also learn about access to water for your new home. These are questions you will want to know the answer to before you purchase your potential building site, or at least before you begin the construction process.
Permits & Inspections
It’s your responsibility as contractor to make sure that the proper permits are purchased, building codes are met, and that inspectors are scheduled. In many cases, subcontractors will help out by calling for inspections themselves. With modular construction this is typically finished electrical, finished plumbing, and mechanical (heating and cooling) system inspections.
You should always agree ahead of time exactly who makes the call or later on you may be ripping out finished work to show inspectors something that wasn’t checked.
It’s important to have a detailed plan before you start construction. This isn’t just the house plan, but a construction schedule and work details that are as specific as possible.
Anything that isn’t fully explained and understood risks raising questions and causing delays with subcontractors. Be proactive, make sure that instructions are complete and scheduling is confirmed.
Getting & Comparing Bids
You will send plans to the needed subcontractors. If you aren’t doing it yourself, you’ll need bids from licensed subcontractors. It will take a week or so get the responses.
Each bid can look very different, but as long as they cover the same labor and materials, you’ll be able to look for bids that are consistently lower in price. It is very helpful to get bids from subcontractors that have experience with modular homes.
You should have your home plans available before you start calling subs. When you gather bids, the subs should give you references, a license number (if applicable in your area), and proof of liability and worker’s compensation insurance.
Always call a sub’s references. Ask what the sub is like on the job, if they stay on schedule, and if they do good work. Hiring good people is usually worth the little bit of extra money it may cost. You’ll be able to trust them and won’t need to be on-site to constantly supervise.
If you have a construction loan, your lender will require you to purchase a Builder’s Risk Policy. If you are building your home with your own funds, don’t forget this important step. A Builder’s Risk Policy is similar to a Homeowner’s Insurance Policy but covers your home during construction.
Be sure to discuss your insurance options with your insurance agent. Insurance is cheap compared to the loss that could be incurred due to fire, theft, or vandalism.
The whole process may only take a week and the steps aren’t that complex, but it’s critical to be very sure that each is done correctly. A modular home is built perfectly square at the manufacturing facility. Unlike a site built home, a modular home isn’t built to disguise imperfections in the foundation.
Surveying The Site
Once the bank loan is approved, surveyors can stake out the corners of the house. This is the first important step in construction because everything else is based on those survey stakes. They are especially important when you have got setbacks and easements to worry about.
CAUTION: Don’t start any work — even a survey — until after your loan closes. Banks get touchy about that because it raises mortgage priority issues. That is, the subs who do any work may legally get their money before the bank would.
Excavation can happen quickly. In some cases you can break ground, install a rough driveway, and dig the foundation in a single day. It will be important to make sure that any trees you want to keep are protected.
Insure you have a place to take excess dirt from the excavation. However, plan exactly where it will go on your building site. It can’t interfere with construction vehicles, crane locations, or the staging/storage area for your modular home sections. As always, Express Modular is ready to assist you with any questions you may have.
Foundation Footings & Walls
The foundation crew is responsible for positioning the foundation according to the plan. But once the excavators move through, the surveyor’s corner stakes will be long gone. So the foundation crew will go by metal off-set stakes that the surveyors set just beyond the digging area.
Today you have many foundation choices. These include: Superior Walls, precast foundation system; Insulated Concrete Forms (ICF’s); poured concrete walls; or traditional block wall foundations. The installation crew for your chosen foundation type uses these stakes to measure back and reset the corners of the house according to the survey. So know where the stakes are and make sure they’re not disturbed. If they do get bulldozed away, the surveyors may have to reset the corners and that can cost a couple hundred dollars.
Site Delivery of Your Modular Home
A modular home typically comes in 2 or more sections. These sections can be 14′ – 16′ wide and up to 60+’ long. The building site must be managed in such a way as to allow a crane to get near the foundation and access each of these sections easily to assemble them on the foundation.
If there is limited room on the jobsite, a staging area to store the home sections may be required. This may also require the use of a toter, a specialized truck to jockey the homes from the staging area to the modular home site. This is a standard process, especially with infill or in town building sites.
Assembling Your Modular Home on the Foundation
On set day you will be responsible to insure that the crane has the ability to move to its required position to setup and access each of the modular home sections. This is important to reduce the overall time it takes to get your home onto the foundation and under roof. A two section home is set and weathered in within one day. A home with 6-8 sections can usually be completed in 2-3 days.
This process is heavily dependent on the weather and the speed and skill of the set crew. Express Modular will coordinate closely with you to insure success at this critical step.
A Weather-tight Home
At the end of the successful assembly of your home it will be weather tight. This means that the roof shingles are completely installed, any and all side walls are up, and all windows that may have been installed at the site are at least rough set.
Now is the time to complete the exterior finish of your new home. If you have chosen vinyl siding, much of this has already been installed at the manufacturing site. The remainder will need to be installed onsite. Soffit, fascia, and guttering will be also need to be completed onsite. If you have chosen specialty siding, the amount of work to be completed onsite vs. at the factory will vary.
Any porches or decks will also be completed at this time. Coordination of your subcontractors to complete these items is important. Interior work will be happening now. Access to the home needs to be maintained at all times.
When completing a modular home the finish work is typically confined to drywall, light trim, and floor finishing/seeming work. Since a modular home comes in sections, this work is usually limited to work on “mating” walls (i.e. wall where the sections line up and attach to each other.). Systems like electrical and plumbing are basically completed in the factory within the sections and must be tied into the onsite connections.
Depending on the part of the country you are in usually dictates the viable heating and cooling systems necessary for the comfort of your home. Whether it’s is a heat pump, oil or gas furnace, or radiant heating, some level of effort is needed onsite to complete these systems. You will be working to get these systems installed and running quickly, in some cases to allow other subcontractors to complete their work more effectively.
The day has come. Your hard work has paid off and you have scheduled your final inspection. Upon its successful completion you will receive a Certificate of Occupancy. This is the piece of paper that says your jurisdiction has approved your new home for occupancy.
Final Bank Work
The Certificate of Occupancy is needed by your lender to close out your construction loan and to convert you to your permanent loan. You will work closely with your lender/settlement company to schedule the last meeting you need to finish up the final paperwork for your new home. Congratulations.
Express Modular is a top modular home provider and is with you each step of the way through the process. Once you have contracted with Express Modular to provide your new modular home, we provide you with a complete Construction Manual which explains in detail each step above along with many tips and ideas to help you along the way. Your success is our success!