Legal Question in Construction Law in Virginia

Re: Signing over deed to have home built.

Why should you have to sign your land over to a builder in order for the builder to qualify for a

loan to construct your house? What this suggests is that the builder may be resource thin and operating on the financial margins.

Under this arrangement, if for whatever reason the project fails and the builder goes into default, your land could end up in the hands of the banks and other creditors.

A better approach would most likely involve you

arranging the financing for this project, putting up whatever collateral may be required,

and keeping the builder out of the fianancing end of the project. Furthermore, you should scrutinize this builder very carefully to ascertain whether in fact he has the resources necessary to complete the project in a successful manner.