Is it legal for a building contractor to continuously change the financial terms of the building contract?

We originally signed an agreement with the building contractor for making 3 payments of 5,000.00 each which would be applied to the down payment of the eventual loan price of the home while the builder carried the balance of the project’s financing until the home’s completion, which is defined as receiving the certificate of occupancy. Well now that the builder has received the 3 payments they want to revise the agreement which calls for an additional 40,000.00 on the day excavation begins. Also, the builder has changed the base price of the home by including any optional specifications i.e. more efficient furnace, etc. that exceeded the original contract or allowance. This IS NOT what we originally agreed upon so is the builder allowed to do this?

Asked on May 10, 2016 under Real Estate Law, Indiana

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 4 years ago | Contributor

A contract is enforceable--if the builder is violating it, you could sue them for breach of contract, to get compensation (called "damages" in the law) and/or for a court order requiring them to honor the contract's terms ("specific performance"). They may only make changes to the extent the terms of the contract itself permit them to, or by mutual consent, such as if you asked for a change or addition and they agreed to do it for a price.


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