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Don't
let bad contractors nail your budget
No-nonsense contract talk
Once you've solicited bids from several licensed professionals, studied them carefully
and selected your contractor, it's time to commit the project to paper. In general,
remodeling contracts come in three flavors: - Cost plus:
You and your contractor arrive at an estimated cost and you agree to pay all actual
costs plus the contractor's fee. It's a common type of bid, but you assume the
risk of cost overruns and corrections.
- Turnkey: The
contractor commits to a fixed price for cost overruns. Change requests are documented,
signed by both parties and typically paid for prior to the change being made.
- Combination:
If you choose to do part of the work yourself, you may combine elements of
the cost plus and turnkey approach. The key is making each party's responsibilities
absolutely clear.
Your contract should include:
- Detailed descriptions covering all aspects of the work to be done.
- Remodeling
plans signed by both parties.
- Payment plan (never pay more than 30 percent
down).
- Start and finish dates.
- Change orders are to be approved
by you before work is done.
- Final inspection and sign-off prior to final
payment.
In addition, include these provisions:
- Cancellation rights:
When you sign a remodeling contract, you have three business days to change your
mind and cancel it. Contractors are required to tell you about this right and
provide you with any cancellation forms.
- Lien protection:
On large projects involving subcontractors, protect yourself from liens against
your home in the event your primary contractor fails to pay the subs. This can
be done by a release-of-lien addendum or by placing your payments in escrow until
the work is finished.
- Permitting: It is the contractor's
responsibility to obtain building permits, if required, and to perform the work
in accordance with all building codes.
- Warranty clause:
Make sure all warranties on products and materials installed by your contractor
are in writing and verified.
Control
the quality
You've heard the old phrase "built to spec,"
right? Well, specifications, or specs, are written instructions
detailing how the work on your project is to be completed, including installation
processes, materials and actual products to be used. Without specs, a contractor
is free to complete the work to his or her satisfaction, not yours. If
your project is a major one and your budget allows, have your architect include
specs with your blueprint and hire a knowledgeable professional as your independent
inspector to make sure the work is performed "to spec." Bottom
line: The best-laid plans of home remodeling have a way of going awry without
your watchful eye to oversee the process from start to finish. If you want it
done right, hire a reliable professional, get everything in the contract, then
watch over it like a hawk to make sure your contractor is performing quality work. Then,
of course, sit back and enjoy a remodeling job done right. |
