5 On Your Side

Home Builder Bails on Franklinton Sisters

Posted April 10, 2008
Updated April 11, 2008

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— Two sisters thought they would be living side-by-side in their new homes, but the builder jilted them.

“The last thing that was done was the drywall, and that was finished in October of last year,” Stacey Dailey said.

Dailey and sister, Carlise Billings, contracted with Richland Homes of North Carolina in September 2006.

“We were so excited. We were so excited,” Billings said.

Richland Homes appears to have abandoned the houses, and Billings may lose her $2,500 deposit.

Dailey worked through Richland Homes to get a construction loan with 1st Mariner Bank. Dailey said the bank allowed Richland Homes to withdraw about $200,000. The builder, however, did not pay all of the subcontractors. She said that the roughly $95,000 left is not enough to pay the subcontractors and finish the job.

On top of the money left in the draw, the amount to finish the home would be “from $50,000 to $100,000 because it’s all on the inside. There’s nothing on the inside,” Dailey said.

Dailey doesn't have the extra money needed to complete construction. If she walks away from the home, her credit will be ruined.

“I'm gonna be stuck with them sticking me. I'm gonna get stuck,” she said.

Maryland-based Richland Homes is no longer licensed to build in North Carolina. In Maryland, the company's license was also suspended and will likely be revoked.

“I want them finished yesterday,” Richard Wolf said.

Wolf developed the neighborhood. He said he is trying to work out a deal with 1st Mariner Bank to take over the homes.

“We would certainly, you know, do it for exactly the same dollar figure and with all of the features in those homes that the people had contracted with Richland to do,” Wolf said.

The sisters said they are hopeful, but not optimistic.

“I am just angry," Billings said.

“We're done. We're done. It's just, it's not gonna happen," Billings said.

Wolf said Thursday he is making progress with the bank and hopes to have the situation resolved within 30 days so the homes can be completed.

Richland Homes did not respond to WRAL's request for comment.

6 Comments

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  • IceCreamMan Apr 14, 2008

    Why the h would anyone pay the builder completely up-front? These sisters seem to be VERY naive. If you don't know what you're doing, don't fake it. Especially when there's 100k+ involved.

  • St Ives Apr 14, 2008

    When building a home go with a larger builder, not some guy who builds three or four houses a month.Nothing should be paid except earnest money, before closing.

  • methinkthis Apr 11, 2008

    10% to start the job, payouts in 10-15% increments as the job progresses and checkpoints are made. Do not under any circumstances allow a builder to draw directly on a construction loan. Pay subs directly. Code inspections are good checkpoints. It does not matter how much anyone else loves the builder and great everyone thinks he is. I remember a builder that had six second mortgages on his personal home. Another sold a paid off note to a bank as if it was still due. If they can be trusted then they can work with you as you manage YOUR construction loan for YOUR house.

  • Mr. Keeping It Real Apr 11, 2008

    I have seen this happen time and time again. Listen to the earlier advice and next time - let the BUILDER get the loan and you don't close until it's FINISHED! That's is about the only way you can guarantee your house will be complete. KNOWING the builder (and how long he's been around) is helpful but not a for sure bet. We were very fortunate when we built.

  • Xiaoding Apr 11, 2008

    Yup. Always pay the subs yourself! Or hire someone to do it for you.

  • IceCreamMan Apr 10, 2008

    Caveat emptor, people. Don't give 100k to anybody before making sure they are gonna do the job. Sounds like excitement got the better of good judgment.