Remodeling Contracts 101

by | Jan 25, 2021 | Remodels

After finding your dream contractor to complete your home remodel project, you will be presented with a contract to sign.

This document goes over payments, work schedules, project specs, and more.

This contract protects both you and your contractor so be sure to read it wisely and thoroughly.

Here are some remodeling contract basics:

What you need to know about remodeling contracts

This document essentially outlines the project in writing. Therefore, it is important for it to be as detailed as possible.

Specifically, these items should be included:

  • Mention that the contractor will secure permits and approvals
  • Payment schedule
  • Project timeline with start and end date

The contract may also require that the contractor’s license number be on the document as well as a clause that outlines your right to rescind. This period is usually only valid for one to three days.

Payment schedule

This is one of the most important aspects of the contract. This is meant to keep both you and the contractor on the same page. If you miss a payment the project can get delayed.

Payments are usually issued as certain phases of the project are completed rather than daily or recurring payments. So, think foundation, plumbing, electricity, and so on.

The first payment is usually around 10% of the total job, but this varies from contractor to contractor.

Project timeline

Your project timeline should include start and end dates. These dates should be specified for certain steps in the process of the project. Not just the project as a whole.

When will the drywall be put up and finished by? When does the kitchen installation start and end? What about electrical work?

Lay this out with your contractor but also know that delays are usually inevitable when it comes to construction. This is just a helpful guideline.

Read more about what roadblocks could affect your timeline.

Change orders

Construction change orders happen when you decide you would like to add or take away from the project. A change order can also be made by the contractor when something comes up that wasn’t known, such as hidden electrical wires or plumbing behind a wall that needs to be relocated.

This can be anywhere from selecting different materials to knocking down an additional wall. Read more about construction change orders here.

Overall, a solid contract and an experienced licensed contractor will ensure a smooth remodel project from start to finish.