Don’t Sign Yet! 10 ESSENTIALS Every Contractor Agreement Needs
Thinking about tackling that big renovation project? Maybe it’s a new roof, an updated kitchen, or even an addition to your home. Before you sign that home improvement contract, stop and read through this blog post. Because we’re sharing the 10 essentials every home improvement contract needs to protect you and your investment.
We’ve all heard the horror stories: delays, unexpected costs, poor workmanship, or worse, being ghosted by a contractor after you’ve already paid. A rock-solid contract can be your best defense against these issues. Let’s break it down into 10 must-haves, starting with number one.
Tip 1: Contractor License & Information
First, know who you’re dealing with. Your contract should include the full name, address, phone number, and license information of your contractor. This isn’t just a formality – it’s your way of verifying that they’re legitimate. Licensed contractors are regulated and have standards they must meet, which protects you. Take a few extra minutes to check their license number on your state’s database. If the information doesn’t match up, that’s a red flag.
Tip 2: Detailed Scope of Work
A vague description of work like ‘renovate bathroom’ won’t cut it. Your contract should clearly outline every aspect of the project: what’s being done, labor time and cost, the materials being used, and even the brands or types of fixtures. Let’s say you’re remodeling your kitchen. Specify the countertop material, the type of backsplash, or even the cabinet hardware. This eliminates misunderstandings and ensures you’re getting what you pay for. If there’s something not included, have it written down as an exclusion to avoid surprises.
Tip 3: Payment Terms
Don’t pay the full amount upfront. A reputable contractor will typically require a deposit, but this should be reasonable. Florida law, for example, caps the deposit a contractor can ask for at 10% of the total project cost if permits are needed. Your contract should also detail a payment schedule tied to project milestones. For instance, a portion could be due when demolition starts, another when inspections are passed, and the remainder upon completion. And always keep receipts or proof of payments!
Tip 4: Project Timeline
A proper timeline is crucial to keep your project on track. Your contract should include the start and end dates as well as benchmarks for specific phases of the project. For example, if you’re replacing your roof, the timeline might say that demolition starts on day one, installation starts on day three, and cleanup wraps up by day five. Timelines also help you identify delays early and hold the contractor accountable. Make sure the contract outlines what happens if deadlines aren’t met, such as penalties or extensions.
Tip 5: Permits and Approvals
Who’s responsible for pulling permits? Spoiler alert: it should almost always be the contractor! They’re the experts and know the local building codes and regulations. Your contract should specify who handles this and include the cost of permits if applicable. Without the proper permits, your project might face delays, fines, or even legal issues. Plus, work done without permits can void your homeowner’s insurance if something goes wrong. Don’t leave this up to chance. I would also recommend adding to your contract or getting in writing the projected timeline for permit submission and a requirement that you be notified once everything is submitted.
Tip 6: Warranty Details
What happens if your new roof leaks six months after installation? A good contract will include warranty information for both materials and workmanship. Material warranties might cover defects, while a workmanship warranty ensures the quality of labor. Ask for specifics: how long does the warranty last? What’s covered, and what’s excluded? And remember, some warranties are voided if the work wasn’t performed by a licensed contractor, so keep that in mind too.
Tip 7: Termination Clause
Let’s face it: sometimes, things don’t go as planned. Maybe the contractor isn’t showing up, or you’ve run into financial issues. Your contract should include a termination clause detailing how either party can end the agreement. For example, the ability to terminate the contract if work hasn’t started within a certain timeframe. There should also be a clear process for settling any remaining payments or returning unused deposits.
Tip 8: Insurance Requirements
Imagine this: a worker gets injured on your property. Without the right insurance, you could be held liable. Your contractor should carry both liability insurance and workers’ compensation. Liability insurance covers property damage, while workers’ comp protects against on the job injuries. Ask for proof of insurance and make sure the coverage is current. It’s better to double-check now than to face a lawsuit later.
Tip 9: Dispute Resolution
Even with the best plans, disagreements can happen. That’s why your contract should outline how disputes will be resolved. Mediation and arbitration are common options and can save time and money compared to going to court. For instance, the contract might say that any disputes will be resolved through a neutral third-party mediator before escalating further. Knowing there’s a plan in place can give you peace of mind.
Tip 10: Signatures and Dates
Finally, make it official! Both you and the contractor need to sign and date the contract. Without signatures, the agreement might not be legally binding. And don’t forget to keep a copy for your records. A signed contract is your safety net if anything goes wrong.
Don’t let excitement for your project cloud your judgment. A well-crafted contract can save you time, money, and stress.
