Before you can hire a remodeling contractor, you will need to sign a contract that states the work being done, the cost of the work, the date of completion as well as several other important details. It is important to make sure that your contract has all of the necessary elements so that you and your investment are properly protected.
Description of the work
All contracts need to specify the actual work that will be done. This should not be generalized, but rather it should be as precise as possible.
Starting and completion dates
You need to make sure that the contractor sets a very specific date for the work to start and a guaranteed date to be completed by.
Terms of payment
Most jobs require a down payment and then a final payment. On larger jobs, there may be several payments throughout the length of the project. These payment terms need to be mentioned in the contract.
Securing of permits
The contract needs to specify that it will be the contractor’s responsibility to obtain any permits needed for the job. Those that refuse to get the necessary permits do so because they are not properly licensed.
Completion date penalties
If the contractor misses the date of completion, he should be penalized. The contract should indicate how much the penalty should be and for what specific time frames. In most cases, the contractor is usually penalized every day that he exceeds the completion date, but is given some form of bonus for finishing early.
Changes in the work
Things always change at the last-minute and when they do, you need to know what the procedure is for handling these changes. The procedures should be outlined within the contract itself.
Cost of materials
Not only should you have already received an estimate for the job, the contractor should also supply you with a detailed cost of materials and labor as part of the contract. If there are specific brands, models and colors to be used on the job, they also need to be stated in the contract.
License, bond and insurance information
Your contract should include a copy of the remodeling contractor’s license, surety bond as well as liability insurance. If these are not included, then do not sign the contract.
Termination clause
At what point does the contract terminate? When can the contractor leave the job without getting penalized? The steps for the termination of the contract needed to be included in it.
Lien release
In the event that your contractor hires subcontractors on the project, you want to make sure that you are protected from any liability. A lien release prevents any subcontractor from placing a lien on your property if the contractor fails to pay them.