Who, what, where, when and how much?

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contractFrom the Federal Trade Commission (FTC) Consumer Protection Division, here is some advice on writing a home improvement contract.

Contract requirements vary by state. Even if your state does not require a written agreement, ask for one. A contract spells out the who, what, where, when, and cost of your project. The agreement should be clear, concise and complete. Before you sign a contract, make sure it contains:

  • The contractor's name, address, phone, and license number, if required.
  • The payment schedule for the contractor, subcontractors and suppliers.
  • An estimated start and completion date.
  • The contractor's obligation to obtain all necessary permits.
  • How change orders will be handled. A change order-common on most remodeling jobs-is a written authorization to the contractor to make a change or addition to the work described in the original contract. It could affect the project's cost and schedule. Remodelers often require payment for change orders before work begins.
  • A detailed list of all materials including color, model, size, brand name, and product.
  • Warranties covering materials and workmanship. The names and addresses of the parties honoring the warranties-contractor, distributor or manufacturer-must be identified. The length of the warranty period and any limitations also should be spelled out.
  • What the contractor will and will not do. For example, is site clean-up and trash hauling included in the price? Ask for a "broom clause." It makes the contractor responsible for all clean-up work, including spills and stains.
  • Oral promises also should be added to the written contract.
  • A written statement of your right to cancel the contract within three business days if you signed it in your home or at a location other than the seller's permanent place of business. During the sales transaction, the salesperson (contractor) must give you two copies of a cancellation form (one to keep and one to send back to the company) and a copy of your contract or receipt. The contract or receipt must be dated, show the name and address of the seller, and explain your right to cancel.

Keeping Records

A written contract doesn't mean much if you can't find it when problems arise. So, once you have that contract, keep all your paperwork related to your project in one place.

This includes copies of the contract, change orders and correspondence with your home improvement professionals. Keep a log or journal of all phone calls, conversations and activities. You also might want to take photographs as the job progresses. These records are especially important if you have problems with your project-during or after construction.

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