Writing and Negotiating the Contractor's
Contract
Right At Home
Daily: Finding It: Contractors
Writing and Negotiating the Contractor's
Contract
By Barbara B. Buchholz for Right at Home Daily
To guarantee you'll be satisfied with a contractor's
work, it'll require more than a handshake or a verbal agreement. You and your
contractor need written rules that'll outline the time and money required to
complete a project.
There
are many standard contract forms you can use as a template. One of
the most popular contracts-known as the AIA form-can be found on the American
Institute of Architects' Web site.
But don't let a form define your project. You
should add and delete details according to your budget and needs. Some details
that should be included: a complete description of the project, the total cost,
the payment schedule, the time frame in which the work will be completed, a
list of all workers involved in the project, what warranties will be provided,
the procedure to change orders, and any special requests.
You can't be too detailed when it comes to a
construction contract.
Break down the total cost to an itemized list.
Simply listing that the kitchen will cost $50,000 is not sufficient. In addition
to listing a product's cost, list what it'll cost to install or apply the product:
the parts (nuts, paint brushes, hinges, etc.) and labor.
If you don't spell it all out, you risk learning
the hard way that you and your contractor have significantly different opinions
about construction standards, quality of the work and the manner in which it
is performed.
So, add the nitty-gritty details because you
can't rely on, "Oh, I thought it would be different." For example,
do you want the workmen using your bathroom and phone? Do you want their lunch
boxes in your refrigerator? Will you care if they arrive at 9 a.m. when you
expect them at 8 a.m.? How often do you expect your general contractor to show
up and to call you about progress?
The more you put into the contract the less likely
troubles will arise or, worse, you will end up in a legal battle.
In fact, if all goes well, you might end up inviting
your contractor over to celebrate the end of construction!
TAKE IT AND RUN
To avoid troubles with a contractor, create a
solid contract that will protect your sanity and wallet.
The best money you'll spend in a renovation job
is on an experienced real estate attorney to write and negotiate your contract.
You should include detailed costs, model numbers
and a fee schedule for the contractor. Many architects, contractors, designers
ask for money upfront, then weekly payments. Never pay more than a small sum
of cash upfront to get the project started.
Withhold at least 10 percent of the total cost
until your punch list is completed to your satisfaction. And set aside enough
money for a backup contractor in case your original contractor doesn't complete
the job.
