Tuesday, April 2, 2013

The Contractor's Contract: What Should Be Included?

A smooth remodel project is only 8 tips away.

You've chosen a contractor for your remodel project. During the initial pre-construction and estimating process, many things have been discussed, so trying to keep track of conversations without a contract can lead to discrepancies and conflict. To ensure a smooth working relationship, follow these 8 simple tips on what should be included in a contractor's contract.This way, if there is a misunderstanding, both parties can refer to the contract for resolve.

The contract. The contractor's contract is a must.  Do not begin any project without one.

An address. Be sure you have the contractor's physical address and not just a P.O.box.  If you need to track your contractor down, you won't find him at a P.O. address.

A license number. Many states require persons who want to perform general, building, and residential construction to become licensed. Proof of a license means your contractor has taken the required courses, passed the state exam, and is playing by the rules.

Insurance. If an accident happens while working in your home, you want to make sure you are not held liable. Liability insurance protects the homeowner, contractor, and the contractors employees. Make sure your contractor is carrying contractor's liability insurance.

Scope of work.  The contractor's contract should present a description of the work to be performed. If your contractor is performing work off your designer's plans, the designer and the feature sheet date should be referenced in the contractors contract.

Agreement price and payments. The contractor's contract should state the agreed upon fee to complete the project. Your payment schedule, deposits, and draws should also be outlined in the contract.

Exclusions. There are certain limitations inherent in any addition or remodel project.  Your contractor should make every effort to anticipate all expenses, however there will be unforeseen conditions or defects which the owner may be be responsible for such as unexposed mechanicals damaged in existing walls, rot and deterioration, structural defects, insect infestation, and defects to roofing and flooring.

Warranties.  The contractor's contract should include a limited warranty against defects in original materials and workmanship which results in actual loss or damage for one year from the date of job completion. Upon written notice, your contractor should agree to either repair or replace, at his option.

Source:  Houzz.com/ Kenny Grono

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