7 Las Cruces builder contract clauses every buyer should read carefully before signing.

Builder contracts are not neutral. They are written by the builder's attorney for the builder's protection. The standard production builder contract used across Las Cruces has language that surprises buyers when something goes sideways. Most of it is negotiable if you flag it before signing. Almost none of it is negotiable after.

Here are the seven clauses we read most carefully on every new construction deal in Las Cruces.

1. The construction delay clause

Every builder contract grants the builder a window of slippage from the original target completion date. The window is usually 30 to 90 days, with extensions allowed for weather, supply chain, and acts of God. Inside this window the builder owes nothing for being late.

Watch for:

• How long the original window is.
• How "weather delay" and "supply chain delay" are defined.
• What rights you have if the home is late beyond the window.
• Whether you can cancel and get your earnest money back if delays exceed a specific number of days.

If you have a hard move-in date (a lease ending, a home sale closing, a relocation report-by date), this clause matters more than almost anything else.

2. The change order clause

Once the contract is signed, any change costs money. The change order clause governs how the builder prices changes, what fee is added, and what changes are simply not allowed after a certain phase.

Watch for:

• Whether the builder charges a flat change order fee on top of the change cost.
• Cutoff dates: after framing, after rough-in, after drywall, no changes allowed.
• Whether the buyer can decline a builder-initiated change without penalty.

The change order trap: buyers sign at base pricing, then accumulate $20,000+ in design center upgrades and change orders that arrive at closing as a surprise. Every change should be paid down in writing as it happens, not aggregated.

3. The earnest money clause

Earnest money is the buyer's deposit at contract signing. Las Cruces builders typically require 1 to 5 percent of the purchase price. The earnest money clause governs when the builder keeps it and when the buyer gets it back.

Watch for:

• Specific events that trigger forfeiture (financing denial, appraisal failure, buyer cancellation).
• Specific events that trigger return (builder delay beyond window, builder default, force majeure).
• Whether the earnest money is held in escrow or in the builder's account.
• How long the builder has to return the earnest money if you cancel under qualifying conditions.

Earnest money in the builder's account instead of escrow is a red flag. Negotiate for escrow at signing.

4. The warranty exclusions clause

The builder warranty book lists what is and is not covered. The exclusions are where the disputes happen.

Watch for:

• Whether settling cracks are covered (most builders say no after year 1).
• Whether buyer-installed items void any warranty (often yes for landscaping, fencing, additions).
• Whether failure to perform maintenance voids the warranty.
• Specific exclusions for natural disasters, including monsoon-related water damage.

See our post on the 11-month warranty walkthrough for more on what to do with the warranty you do have.

5. The financing contingency clause

If you are getting a mortgage, your contract should include a financing contingency that lets you cancel and recover earnest money if you cannot qualify for the loan. Builders sometimes try to remove or weaken this contingency.

Watch for:

• Whether the contingency is conditional on using the builder's preferred lender.
• Whether the contingency expires before underwriting is complete.
• What documentation you must provide to invoke the contingency.

Avoid contracts that condition financing contingency on builder lender approval. If you are forced to use the builder lender to get the contingency, you have given up your negotiation leverage on the lender side.

6. The dispute resolution and arbitration clause

Many builder contracts require arbitration instead of litigation for disputes. Arbitration is private, fast, and limits damages. It generally favors the party that drafted the contract: the builder.

Watch for:

• Mandatory arbitration language.
• Class action waivers that prevent you from joining other buyers in a complaint.
• Limits on damages (no consequential damages, no punitive damages).
• Who picks the arbitrator and who pays the fees.

Strike or modify what you can. Some builders will negotiate. Some will not. The ones that will not are usually the ones whose contracts you want to read most carefully.

7. The "as is" walkthrough clause

The clause that says you accepted the home in its current condition at closing, waiving all defects you should have noticed at the final walkthrough.

Watch for:

• Language that requires you to identify every defect at walkthrough or waive it.
• The deadline to submit walkthrough deficiencies in writing.
• Whether the warranty period covers issues you might have missed at walkthrough.

This clause is why we walk every home with our buyers at the final walkthrough with our own punch list in hand. Anything missed at walkthrough often becomes the buyer's problem.

What is usually negotiable

Most builder contracts allow more flexibility than buyers expect. In our experience, builders will move on:

• Earnest money amount and escrow placement.
• Specific warranty additions or exclusions.
• The financing contingency wording.
• Construction milestones with status reporting.
• Specific change order pricing language.

What they rarely move on:

• Arbitration and class action waivers.
• Delay window allowances.
• "As is" walkthrough acceptance language.

Knowing which battle to fight matters more than fighting every battle.