Editor's Note: The names of the homebuyers used in this article have been changed to protect their privacy during ongoing litigation.
STUTTGART, Germany -- After Andrew and Candice Nash's friends recommended that they use a particular German company to build their new home, and the company agreed to do everything from finding the property and arranging for financing to installing the kitchen and lights, the Nash family jumped at the opportunity. Now, they are in court proceedings with the company, fighting over a house that was never built.
The Nash family is among a small but growing group of Stuttgart militart community members who have recently encountered significant problems while attempting to build a home in Germany and who want to inform the community about their experiences.
"I hope I can save someone else the pain that we went through," Candice Nash said. "There are good builders out there, but the one we used isn't one of them."
Wolfgang Kunz, a German attorney located in BAfAPblingen, has represented at least five different individuals in their dealings with another German homebuilder. According to Kunz, that builder has engaged in unfair behavior that is unusual for a German company.
Many of the complaints by Kunz's clients are similar: promises not kept, timelines not met, hidden fees and misleading information.
One customer, Charles Mendolina, was told that he was required to sign a contract with the company before a bank would finance the deal. The contract, however, was written in German and bound the customer to pay Ac'A!270,000 before there was ever an agreement on what the house would look like. More problems followed.
Although the company's representative created the impression that services such as landscaping were included in the basic contract price, Mendolina was later told that this was not the case. Further, he was prevented from ever speaking to the company's architect, which only served to delay and confuse the process.
"Every time that I'd suggest a change [through] the company representative, he'd go back to the architect and then, a week later, the representative would come back to me with a design that included changes I never requested," said Mendolina. At other times, Mendolina asked the company to reduce the overall cost of the project. When the company representative came back with a new design, however, the overall cost would remain unchanged.
Nine months after entering into the contract, Mendolina informed the company that he had had enough. Soon thereafter, he hired a new company, which provided him with an English translation of the contract, ensured that he understood the contract and never pressured him to sign anything until he was comfortable. In just over four months, the company finished the house with no problems.
Meanwhile, the friends who recommended the first company to Mendolina are still sorting through problems with the company.
"There are people who are still going through hell with them. I went through hell with them, and I got out early," said Mendolina, who was sued by the company for 10 percent of the contract price.
Another customer, Emma Armour, was drawn to the company because, along with the financial benefit of owning rather than renting, the company promised that her home would be completed in a short period of time.
In October 2009, Armour was told by the company's realtor that she could be in a new home by the following May. As it turned out, ground was not even broken until June. Moreover, after giving Armour little time to search for a piece of land and then rushing her to choose furnishings, the company showed little urgency to complete her home. When she inquired into why, the company's response was that the property was too far away to get to easily and that the company had other homes it needed to build.
Later, the company informed Armour that it needed to change the design of the home due to the scope of the land. Yet, despite the fact that the home was being built at the bottom of a hill where water would accumulate and sit, the company never informed her that the plan did not include a drainage system.
"It was like we were an afterthought," Armour said.
Despite her experience, Armour said she would still prefer to build and own, rather than rent. But if she were to do it again, however, she would look for certain warning signs. These include the lack of a definite time frame, the lack of an itemized list of expenses and an arrangement where no one company is responsible for the overall project.
Armour said she initially believed that the companies performing tasks such as installing tiles were subcontractors for her builder. Yet, when she approached that company about details concerning tile installation, Armour was told that the matter was between her and the installation company - that the builder she hired was not responsible.
Kunz echoed Armour's recommendations. "Know who your contract is with," he said. And, for a purchase as large as a home, he recommends using an attorney. While it may cost more up front, customers will often save in the long run.
Although there are many benefits to building a new home, a great deal of work is involved to ensure that the project is a success. Along with seeking recommendations, interested homebuyers should visit homes that a particular company has built, and inquire into whether complaints about the company have been registered with the Verbraucherzentrale, the German equivalent of the Better Business Bureau, before signing a contract with them.
Additionally, a homebuyer should never sign a document that he or she cannot understand. Of course, even when signing a contract that appears to make sense, problems may still arise. Most problems, though, are ones that builders should be accustomed to solving, Kunz added.
If it seems as though a builder is not acting properly, contact the local legal assistance office.
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