Recently we shared tips on how to find and qualify the right contractor. We covered the research, interview and selection process. Next, follow these tips as you navigate contracts, communicate with your contractor, deal with problems, and settle on payment terms.
Draw up a detailed written contract which would include:
• Complete name and address details of yourself and the contractor, as well as job site address.
• Notation of contractor’s insurance coverage.
• Detailed description of all aspects of the project including quoted price, plans, drawings, specified materials and procedures.
• Job specifications should be documented including any work being carried out by subcontractors.
• Notation of building permits that are required as well as outlining who is responsible for paying for and obtaining them.
• Details pertaining to warranties.
• Terms of payment.
• Starting and completion dates. And if possible, the dates the contractor will be working at your home, as they often divide their time between projects.
• Guidelines and boundaries for working in and around your home (i.e. what parts of the home will they have access to).
• Establish how problems will be handled.
• Statement that the contractor will clean up at the end of each day, and that at the completion of the job, they will clean up and remove any debris.
Payments and Holdbacks:
• Do not pay more than 10% of job as a downpayment before renovation begins.
• Large projects often require interim payments. Pay only for work that has been completed.
• Hold back money to make sure the job is completed to the specifications outlined in the contract, and to your satisfaction. Doing so also protects yourself against any liens that could be placed on your property by suppliers or workers that the contractor failed to pay.
• Make cheques payable directly to the supplier not the contractor if you are requested to provide money upfront for materials, appliances, etc.
• Pay by cheque rather than cash if possible. This provides a documented record of payment.
• If you do pay with cash, ensure the contractor provides you with a signed receipt.
• Make a list of questions and touch base frequently – especially if it’s a large project.
• Immediately raise any problems or concerns you may have.
• Schedule a meeting to discuss important matters in order to have the contractor’s full attention.
• Document any necessary alterations in the written contract.
• Recognize that every renovation will have it’s own set of issues that arise. Have a plan to deal with them effectively to prevent major delays.
• Raise your concerns immediately.
• Schedule a time to meet with the contractor to discuss the issue.
• Review the details of the contract.
• Clearly define the issue.
• Keep emotions out of it by dealing with only the facts.
• Listen to the contractor – you may learn how any misunderstandings developed.
• Create a plan to resolve the issue and put it in writing.
Release of liens:
• Contractor provides a release of liens at time of completion which states that they been paid in full for the work done and waives their right to place a mechanic’s lien on the property. For information about the Construction Lien Act click here.