Important Clause in all Home Improvement Contracts

by Julie

A Must Have Clause in all of Your Home Improvement Contracts

For any home improvement project, an important clause to include in the contract is “Owner needs at least 24 hours to review all invoices.”

In addition to the written contract, be sure to verbally discuss this with any contractors you hire.  Tell them-face to face-that you want to review the invoice and inspect the job before they are paid.   Ask them to honor this request and not put either of you in an uncomfortable position.

Contractors are notorious for last minute invoices. They will tell you they must collect payment to:  pay their crew on Friday (as they hand you the bill Friday morning), or buy materials now, or get their truck fixed…  This is why it is so important to firmly discuss this upfront during negotiations.

There are many reasons, but two stand out:

1.     You want to ensure that the job is done to your satisfaction before the final (or majority) of the money is paid.  Money motivates. This is your way-the ‘money carrot’- to make certain the contractor comes back if additional work needs to be done.
2.    On big projects, there are ‘draws’ along the way.  The dollar amounts of the draws should line up with the actual amount of work completed.  This ensures that there is always enough money left to finish the job.  Your contractor may leave or you may have to fire them.  Don’t let the contractor get financially ‘ahead’ of the project.

I’ll share a story that falls into the category of ‘I Do Know Better’.  I hired a couple of guys to install a patio cover with a gutter at the back of my own house.  I furnished all of the materials.  It turns out that there was a friend-of-a-friend connection so we got to talking about that and I dropped all of the wisdom I’ve gained as builder for 20 years.

True to form, it was a Friday afternoon when I came back home to review the work.  Looked good except the gutter wasn’t pitched right.  They needed to be paid right away…out of money, weekend here…yada yada.  They assured me that if the water didn’t drain right, they would come back to fix it.

I’m sure you can guess the rest of the story?  I’m now faced with hiring someone else or fixing it myself.  What a pain!  I should have held back half of the money.  That would have been motivation enough to come back.

If the contractor asks ‘why’ you need so much time, here are some good reasons to use:

•    I want time to review the work and invoice.  I haven’t done this before and it will take me time to digest it.  Surely you understand that?
•    I need to transfer funds into my/our checking account.
•    Someone – spouse, other family member, friend, etc. – is helping me with the project and I want time for him (or her) to review the invoice.

Most of the time, there should be no issue about giving you time to review the invoice and the work it covers. Just make sure this clause is included in all your home improvement contracts.

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Ann September 22, 2010 at 2:30 pm

Great article and advice. Will save $ and potential problems!

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