A 'good sense' list
To save headaches later, consider drawing up a short list of qualified professionals in your area by logging on to the National Association of the Remodeling Industry, the National Association of Home Builders or the Better Business Bureau. To help your search go smoothly, you could check out how to hire a professional remodeler.

It's also good sense to make sure the contractor you choose has:

• verifiable business licenses, certification and professional affiliations.
  
• previous work experience, including a verifiable list of local customer references.
  
• financial security (check banking and supplier references).
  
• adequate insurance to protect you and your property against loss or suit.
  
• good communication skills.

That last item should not be taken lightly. When you get down to writing the contract, clear communication on both sides is your single best insurance against a remodeling nightmare.

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 order process, to be approved by you before work is done.
  
• final inspection and sign-off requirement 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 writing in the contract, and then watch over it like a hawk to make sure your contractor is performing quality work.

Then, of course, sit back and enjoy what you have caused to be done so well.

Jay MacDonald is a freelance writer based in Mississippi.

Bankrate editorial assistant Leslie Hunt contributed to this story.