Private builders who work with turnkey contractors have benefited from the consumer construction contract since 2018. This increases their protection against financial losses in the event of the construction company becoming insolvent, including with regard to payments on account. This is because these are set out in a payment plan, which is ideally a central component of the consumer contract.
According to the Verband Privater Bauherren, it is crucial that each payment plan is individually negotiated and precisely specified in the building specifications. In this way, installment payments are linked to actually completed construction phases. This protects the client from premature, high payments for unfinished work. Caution is advised with contract offers that demand high down payments or advance payments without the corresponding construction work having been carried out.
A correct payment plan should always include a security provided by the contractor. According to the VPB, clients should have the contract and payment plan checked by an independent expert before signing. In this way, they can ensure that the payments are appropriate to the progress of the construction work.
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