What Should Be Included In My Home Improvement Contract?

When hiring a contractor for any type of home improvement or home service there are some basic responsibilities of the contractor. They should provide you with a written estimate, or contract, which clearly states their business name, physical street address, phone number and NYC Home Improvement Contractors license number. It should also specify the goods and services they are or will be providing, and at the end, provide a receipt for the payment you made for those services.

An estimate or contract can be handwritten, and does not necessarily have to include a bunch of legal jargon, especially when having a repair or maintenance service. However, it should clearly state the materials and services that the repairman or contractor provided, and the warranty terms.

When hiring a contractor for a home renovation or remodel, a comprehensive contract is essential to the success of your project, as it will provide you and your family protection, when properly written and executed.

One of the most important items in your contract is the description that thoroughly outlines the work, materials, products and services that will be provided for your project. That includes everything from what is being demolished to what is being constructed. It should include each type of fixture, component or product that will be used, and where it will be installed, and include the brand of the product, color, and size.

The contract should also include a written warranty, covering the materials and workmanship for at least one year. The warranty terms should be noted as "full" or "limited". The name and address of the party who will honor the warranty should be identified; whether it be a warranty issued by the contractor, distributor or manufacturer.

The contract should also list the subcontractors, and specialty craftsmen that are being used on the project, and the products and services they will be providing. As important as it was to vet your primary or general contractor, that same process should be used for any subs that will be in your home.

The contract should also specify that the contractor will secure all work permits, and be responsible for the sign offs required to obtain an updated certificate of occupancy. If there is no permit included in your contract, you should consult with an architect to identify if your project requires a permit. Failure to secure a permit, or having work illegally performed in your home, can lead to violations and can cost you thousands of dollars when trying to legalize it in the future.

The contract should also specify that any and all debris will be legally removed from your home and properly disposed of. There are guidelines for the safe disposal of debris, which may include the requirement to obtain permits for a dumpster.

When engaging your contractor, ask about their insurance coverage and have them provide you with Certificates of Insurance for General Liability and Worker's Compensation. Without this coverage, the homeowner will be financially responsible for any damage done to their home. Furthermore, a homeowner can be responsible for damages should an employee of the contractor get injured on the job.

The contract should state the total cost of the project, along with a payment schedule, outlining the timing and amount of the payments. All payments should be based on project milestones, such as; when demo is completed, when plumbing and electrical roughing in completed, when products are delivered to your home, when electrical fixtures are installed, and when trim work is completed. It is customary that 10% retainage is left until the end of the job, to ensure that all work is completed as specified, and to make sure the "punch list" items are completed to your satisfaction.

Any subcontractor that provides work as part of the project has a right to place a lien on your property, even if you have paid the contractor in full. When reviewing the contract, make sure all subcontractors are listed, and their services have been itemized in the contract. Furthermore, have your contractor provide a "lien waiver" for each installment payment before you pay the next one. This will protect you from liens against your property by the contractor and subcontractors.

Your contract should include approximate start and end dates of the project. Although there can be delays due to weather conditions or unforeseen circumstances, it is a good idea for there to be an understanding between you and your contractor on when the project will start and how long it will take to complete.

When there are changes to the project, have your contractor put it in writing. No changes should be made unless both you and your contractor have agreed to the changes in writing, and the details have been agreed to, including the change in cost, and how it will affect the project schedule. If there was a verbal agreement made on the fly, follow up with an email to the contractor restating the details and your approval, and request that they respond with a confirming email. This will provide a written record of the change.

Before signing your contract, make sure there is a cancellation notice. In New York City, every consumer has the right to cancel a contract that they signed within three days of the date they signed the agreement. Even if you have provided a deposit with the signed agreement, you are entitled to a full refund when cancelling. This cancellation must be provided in writing, so ask your contractor if they have any special forms that you need to fill out to execute the cancellation, or ask if they will accept the cancellation by email.

A contract is not a binding legal document unless it is signed by both parties. Make sure both you and your contractor have signed the agreement and you have a dually signed copy in your possession prior to the start of work.

Thoroughly review the entire contract and be certain you understand it before signing it. It is important to ask questions about terms, or unfamiliar processes if you are not clear what they mean. If it's not in the contract, it doesn't exist. When it comes to your remodeling project, and protecting your family and home, you can never ask too many questions. 

It is a good idea to keep a file to include the contract, plans, material specifications, invoices, change orders and all correspondence with the contractor. You may need to refer to these documents in the future.

or any questions about a contractor, or the requirements of a contractor agreement, you can contact the NYC Department of Consumer Affairs by calling 311, or visit their website at www.nyc.gov/dca.

For any questions about your remodeling project, you can contact HIC of Staten Island by e-mail at hicofstatenisland@gmail.com.

Lana Seidman, Executive Director        HIC of Staten Island, Inc.

(718) 356-2323    www.hicofsi.org     narihic@gmail.com

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