A recent news story indicated that complaints by homeowners against remodeling contractors were on the top ten list of most frequent consumer complaints. Our experience confirms this. Having been involved in many lawsuits between homeowners and contractors, we cannot overemphasize the financial and emotional difficulties which can result from ignoring basic business formalities when dealing with a remodeling contractor.
While a person might spend $5,000 to $50,000 or more on home remodeling and renovations, important details are often overlooked. Most significant is having some form of written agreement setting forth the scope of work to be performed and the payment and work progress terms.
While this seems a simple matter, many people casually assume that the parties each understand and agree as to the work to be done and the contract price. Unfortunately, problems often arise after the work has been “completed”.
We recommend that contractor and homeowner enter into a reasonably detailed written agreement. Drawings and basic specifications should be attached where possible. Payment and work progress terms should be spelled out, and perhaps most important, the agreement should state clearly that there will be no modification of its terms (“extras”) unless both parties agree to them in writing in advance. Many contractors will have a form agreement which can often serve as a point of departure. The payment terms should specifically correspond to work to be performed and a substantial retainage (hold-back) should be held for at least 30 days after work is completed.
There are many good builders who loathe formal contracts and such details; after all, they are not attorneys. However, a reputable builder interested in your business should be able to provide a detailed agreement which will satisfy all parties involved. Lawsuits after the fact are frustrating and costly, pitting your word against the builder’s word. It’s fine to like and trust your remodeling contractor but make sure you put all the details down in writing to avoid disputes in the future.
While a person might spend $5,000 to $50,000 or more on home remodeling and renovations, important details are often overlooked. Most significant is having some form of written agreement setting forth the scope of work to be performed and the payment and work progress terms.
While this seems a simple matter, many people casually assume that the parties each understand and agree as to the work to be done and the contract price. Unfortunately, problems often arise after the work has been “completed”.
We recommend that contractor and homeowner enter into a reasonably detailed written agreement. Drawings and basic specifications should be attached where possible. Payment and work progress terms should be spelled out, and perhaps most important, the agreement should state clearly that there will be no modification of its terms (“extras”) unless both parties agree to them in writing in advance. Many contractors will have a form agreement which can often serve as a point of departure. The payment terms should specifically correspond to work to be performed and a substantial retainage (hold-back) should be held for at least 30 days after work is completed.
There are many good builders who loathe formal contracts and such details; after all, they are not attorneys. However, a reputable builder interested in your business should be able to provide a detailed agreement which will satisfy all parties involved. Lawsuits after the fact are frustrating and costly, pitting your word against the builder’s word. It’s fine to like and trust your remodeling contractor but make sure you put all the details down in writing to avoid disputes in the future.
– Curt Ward