Home Remodeling Contracts – Tips and Precautions: It’s Always Buyer Beware

by TheWritingCowboy

If you need to hire a contractor for work there are a number of things you need to be aware of. This article offers you a list of guidelines and suggestions.

I usually like to do some DYI around the house. I don’t claim to be an expert but I can get some things done without messing it up or hurting myself. But, several times in my life I’ve had to rely on professionals to do the work, from plumbing and electrical to whole house remodeling. What I’ve discovered over the years may help you as well.
For a major remodeling project I undertook I thought I had a pretty good idea of what I wanted accomplished and how much it might cost. I searched out various contractors, got bids and determined what other jobs they’d done of a similar nature in the area. But, when it came time to sign on the dotted line with my chosen contractor I learned you must be vigilant about what to include in the contract before you sign it. And, there is always a contract! Agreement by shaking hands or spoken agreement is not only frowned upon, it can be downright dangerous.

Preparing For The Project

My project was fairly modest. It was a combination of making some cosmetic adjustments by replacing some windows and doors, rebuilding a deck and balcony and sprucing up a few other areas of my house.

In my interviews with several contractors I asked about their take on materials to be used, the length of time it would take, the complexity of the work, etc. This is pretty basic stuff for any construction project.

But, as I narrowed down my choices and took a look at the contractors’ estimates I came across some fairly large gaps in the language used in their written contract for service. Some of the contractors balked at some of the language I wanted included that I thought was fair and basic – one contractor who looked at my additions immediately said he wanted nothing to do with me. Others were skeptical and tried to convince me that the items I wanted included were unnecessary.

What did I want included in my contract? It’s surprisingly simple, as you’ll see. What’s more I didn’t come up with these items because I’m overly knowledgeable about construction – I’m not. These were just basic and logical and I needed no more than a few minutes of web research to figure that they were important enough that I wanted them included in my contract. They might also be important for you to include them in any construction contract you are asked to sign.

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Things You Should Add To A Contract

1. Debris removal and clean up – do you think your contractor will automatically clean away construction debris and leave your home in good condition? Not necessarily. Renting a garbage bin and having workers clean up the job site costs money and unless you insist they do so this could be an area where they’ll say, “it isn’t in the contract.” What you want in your contract are the words “broom clean condition.” Again, assurances not in writing are worthless and may leave you holding the bag – or in this case, the broom.

2. Have your contractor agree that he will secure all his materials (e.g. equipment tools) and that any left on the premises after work ends for the day or week is his responsibility. One of the contractors I interviewed told me his tools were stolen from a nearby jobsite and he had to buy new ones, all because he failed to lock them away each day after work. Any neighborhood is subject to thieves who will take advantage of a work site. While you are away and/or when your contractor is not on site (like weekends), thieves can help themselves to tools and equipment. Make sure your contract says you are not responsible (nor is your insurance company) for replacement of the contractors’ tools and equipment left unsecured should thieves strike.

3. Safety is always job number one on a construction site. But safety is primarily the concern of the contractor and his workers. Don’t rely on your home insurance to cover accidents. Insist that you contractor, his workers, sub-contractors and others will make all efforts to insure the safety of the work site. Make sure they have the necessary workers’ compensation coverage.

4. In most states, contractors are required to be licensed. Put in writing in your contract that your contractor verifies he is licensed and that his license is current and in good standing. In most states you can even look up the contractor’s license online to see if there are any outstanding complaints against him or actions pending.

5. The contractor is responsible for getting any permits required for your work from city officials. For small projects this isn’t likely to be needed. But, for major projects it is and you should make sure your contractor obtains them. This also insures that city building and safety inspectors will be checking the work for compliance with local codes. Going without permits might be cheaper and faster but when it comes time to sell your home you’ll find yourself in big trouble. Also, should there be any damage to your home your insurance company is not likely to pay up if they find unpermitted work was done.

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6. Contractors use sub-contractors for much of their work. Specialists like plumbers or electricians are brought to the job site to do specific work as directed by the contractor. They are not usually employees of the contractor. Accordingly, put language in your contract that clearly states the contractor is responsible for the payment of any sub-contractors and shall obtain lien releases from sub-contractors as may be necessary. You should also include a statement like, “contractor agrees to indemnify and hold harmless the owners from any claims or liability arising out of the work performed by the contractor under the agreements with said sub-contractors.” You don’t need a lawyer to draw up that language, it’s very basic wordage that is standard in contracts, but you should make sure it definitely is in your contract.

7. In my project, and in most construction work, there will be materials to purchase. In most contracts the specific material should be detailed. If you are going to buy the materials yourself you’ll know what you are paying. However, if you want to have your contractor take care of buying all the specific materials for your job (and he quotes a cost for the materials in the contract) you should first check the price with your local lumber yard or hardware store and second, insist in the contract that you get copies of the invoices for the materials so you can check that the price you agreed upon is indeed the price of the material that was purchased.

8. Detail in your contract how you are to pay for the work. Contractors usually include this – obviously because they want to be paid. But, there are variations. Usually you are required to make a “down payment’ on the work, perhaps 10 to 15 percent. Then, depending on the extent of the work, you will be required to make additional payments at various points as work proceeds with a final payment at the end. However, all this is negotiable. Don’t agree to pay so much up front or during the project that what you owe at end is miniscule. You should hold out at least 25 percent. That’s your leverage to make sure all work is done as promised and your worksite is spotlessly clean and ready to move in.

I finally found a contractor who had no problems including my additions in the contract. Remember, if it isn’t in writing it doesn’t exist. Don’t feel or be made to feel “silly” for including what might seem obvious. When it comes to construction projects it’s better to feel “silly” than “sorry.”

 

Updated: 08/26/2014, TheWritingCowboy
 
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Rose on 11/12/2014

Great advice especially the bit about getting them to clean up afterwards

Telesto on 08/27/2014

Excellent advice. Thank you.

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