Home Remodeling Tips To Know Before You Sign That Contract!

Home remodeling tips to know before you sign that contract! It is not unheard of for a homeowner to pay thousands of dollars to a contractor only to have the work never completed and the contractor long gone.

During the past few years the prices of homes throughout the United States have escalated to a point where homeowners are choosing to remodel or add on to their existing homes rather than purchase another house. Anyone who has been through the process of remodeling their home is certain to have some type of war story about the experience.

It is not unusual for a contractor to incur delays, a building inspector to require upgrades to the existing plumbing and electrical systems, or misunderstandings to occur between homeowner and contractor. Most homeowners who have undertaken a remodeling or addition project will agree that the cost exceeded the amount they were quoted by approximately fifteen to twenty percent.

Each year thousands of people remodel their homes. However, for some the experience can turn into a nightmare. It is not unheard of for a homeowner to have turned over thousands of dollars to their contractor, only to have the work never completed and the contractor long gone. Before signing a contract with a builder there are several things which need to be done.

Contact and interview three to five different contractors to obtain bids and ideas for the project. References must be obtained and verified, the Better Business Bureau called, and the State Licensing Board contacted. A contract should be written which clearly spells out the obligations of the builder. Funds for remodeling should be paid in increments based upon certain benchmarks being met. Beware of a contractor who comes to your door with a contract and pen in hand at the first meeting. If a contractor seems to be urging you to sign on the dotted line during your initial meeting with him, look for another contractor!

Choosing a Contractor

Always interview and obtain bids from at least three different contractors. A reputable contractor will always offer perspective clients a list of references the contractor has performed work for. It is important that several references from each list be contacted. Ask questions such as: Did the contractor complete the job in a timely manner? Was the homeowner satisfied with the quality of work? Were the workers who came to the job site professional, courteous and responsible? At the end of each work day was the home left in a safe and orderly fashion? Did the contractor oversee the project himself or did he have a foreman oversee the job? Were there any unanticipated costs or delays during the project?

After receiving the bids and having contacted references from each of the list, a homeowner should contact both the Better Business Bureau and State Licensing Board to inquire as to any past or existing complaints registered against a contractor. If a builder has several complaints against his business, it may be wise to rule him out as the person to perform the work on your remodeling job or room addition.

Carefully review the bids from each of the builders you are thinking of working with. A contractor who submits a very low bid may not be using the same quality of materials. One contractor may be quoting a price for redwood decking, while another is quoting a lower price for pine decking material. The contractor submitting a low bid may estimate a lighting fixture allowance of $250, while the mid- or higher-range bid may include a fixture allowance of $600. Confirm that all bids are for the same size project.

Once you have interviewed each of the contractors, verified references, contacted the Better Business Bureau and licensing board, and compared each of the bids you should be in a position to select a contractor. However, it still isn't time to sign that contract yet!

Before Signing the Contract

Thoroughly read the contract from beginning to end and ask any questions you may have regarding the terms, conditions and wording contained in the contract. You may want to consider asking to have an attorney review the contract on your behalf prior to signing it.

Ask the builder if he is willing to have the funds he will be paid placed in an escrow account to be remitted to him upon certain benchmarks being met. Never pay a contractor all moneys prior to the commencement of work. Payments should be made in reasonable increments which should serve as an incentive for the builder to complete your remodeling project in a timely manner.

The contract should contain a description of the work to be done, the cost to complete the project, any allowances to be made regarding fixtures, a list of items the contractor will be providing; as well as, a list of items the homeowner will provide or be responsible for.

Once you have reached an agreement with the "written" contract it is time to sign. Notice the key word in the previous sentence is "written!" The written agreement should contain any and all verbal agreements the contractor has made with the homeowner during the negotiation process.

It is important for a homeowner to realize that there will be snags and delays along the way when remodeling a home. However, by carefully choosing a contractor and cautiously reviewing and negotiating the terms of the contract many misunderstandings can be avoided. It is reasonable to assume that a contractor is more likely to do a better job for a homeowner who has taken the time and effort to making thoughtful and reasonable decisions.

© High Speed Ventures 2011