Advance Payment Plan Experiences

Hello everyone,

can you give me an assessment of the following installment payment schedule?

Conditions:
-Row house ~450k (+100k land)
-Prefabricated house 150 sqm
-Turnkey except for kitchen and lighting
-Wood frame kfw55
-Flat roof
-Single garage
-Windows, electricity, water, underfloor heating, screed, interior cladding, plaster paint, etc. are all installed only on site.


From the consumer construction contract:
...
The following installment payment schedule applies:
3% upon signing the contract
15% at the start of the solid construction work
20% at the start of house production in the factory hall
20% upon completion of house production in the factory hall
25% at the start of house assembly on the construction site
10% at the start of installation work (heating, sanitation, etc.)
5% upon completion of interior finishing
2% at final acceptance

Changes or overlaps in the order may be possible due to the construction process. In this case, changes to the payment steps will be timely reported to the client by the construction company.
…
Completion: 11 months after receipt of the building permit
Should the completion date be delayed due to force majeure (e.g. extraordinary weather or natural events) or other circumstances unknown at contract signing, the construction company cannot be held liable for any delay costs.
…
The construction company points out that it is neither obligated nor willing to participate in a dispute resolution procedure before a consumer arbitration board under the Consumer Arbitration Act.



Are such passages and high advance payments common? It seems very risky and strange to me.

Thank you very much for your feedback.

If payment were made after completion of each respective section, that would be fine. As it stands, you are advancing payment everywhere and would have paid nothing or even more in case of emergency.

So, you paid 58% and have a [Bodenplatte (?)] Then you paid 83% and don’t even have windows installed yet, if things go badly. Nothing more needs to be said. Tick, as in ticking off…

Do not skimp on the completion guarantee in the payment plan under any circumstances. You pay a lot of money and still have no value on the construction site. Ideally, you would look for another provider. Payment at the start and with such a large advance is totally inappropriate, in my opinion.

If payment were due after the completion of each respective section, that would be fine. As it is, you are advancing payments everywhere and would have paid nothing or even more in case of an emergency.

Even then, it would be a pure lottery... over 50% of the total amount would already be due when the company reports the completion of the prefabricated house parts in production.
But... how does the interested lay builder verify this? Even if you go there yourself. How do you know that you are shown the parts that will ultimately be used on your own construction site?
To someone who has no idea, you can fake anything... and that is exactly what happens... daily.

-Wood frame kfw55 [...]
15% at the start of the solid construction work

Start of the solid construction work in a wood frame panel "ready" house – do they mean the masonry of a basement?

-Terraced house ~450k (+100k land)

And all that as a terraced house in a (covert?) developer project?
Do they believe you don’t read insolvency news about providers of market-oriented projects who are currently broadly in turmoil?

So, you paid 58% and have a foundation slab (?) Then you paid 83% and still don’t even have windows in, if things go badly. That’s all that needs to be said. Tick the box, move on…

Don’t skimp on the completion guarantee with that payment plan. You pay a lot of money and have no equivalent value on the construction site yet.
Ideally, you would look for another provider. Payment at the start and such a high upfront payment I find totally inappropriate.

Withdrawal, yes, but another provider is difficult with developer terraced houses.