To help ensure a stress-free home renovation it’s very important that you and your home professional are on the same page. Communicate clearly. All aspects of the renovation should be put in writing. Creating a detailed renovation contract will protect the interests of both you and your contractor should future complications arise.
A renovation contract is a legal agreement between you and the company you hire to do your renovation. It lays out the responsibilities of you and your contractor as it pertains to the renovation and provides detailed information on the scope of work, payments, permits, inspections and the warranties provided.
Tips to Creating a Detailed Renovation Contract
Basic Business Requirements
The contract should include the contractor’s name, address and contact information. The home professional should also provide documentation showing that they have adequate business liability insurance and a Business or GST/HST Number. If required, they should also provide a Municipal license number and proof that they are enrolled in your province’s Workers’ Compensation program.
Scope of Work
The renovation contract should include all aspects of the work to be done and the materials to be used. It may seem monotonous but it’s very important to get every last detail of your project ironed out with the home professional. Changing plans in the middle of a project is costly. List all of the home contractor’s responsibilities, right down to who’s responsible for clean up after the job is completed. If sub-contractors are to be used, include who is responsible for hiring and paying them, as well as guaranteeing that their work is done properly. Include a work schedule, as well as the start and estimated completion dates.
If your renovation is modified while work is being done, ensure your home professional creates a written change order. Both parties should sign the amendment.
Keep a job file which includes contract, plans, specifications, invoices, change orders and all correspondence with the home professional. eRenovate offers the handy Project Tracker tool for free when you hire Bonded by eRenovate™ Pros.
The contract should include the total cost and the payment schedule. A good rule of thumb is a 10% deposit up front and then incremental payments should be made when each major target is reached in the renovation process. Remember to clarify if Goods and Services Tax (GST) is included in their quote. Do not accept tax-free offers, you may not get a receipt, which is your legal proof of payment for services and/or materials. Trustworthy companies meet all legal requirements, like charging and paying applicable taxes. Avoid cash deals.
Permits and Inspections
It’s the responsibility of the homeowner to ensure that all the necessary permits are obtained and inspections are done. Your contractor can get permits and schedule inspections on your behalf; just make sure this is clarified in the contract and do not allow construction to commence until you’ve seen the permits. Note, the contractor will charge you for this added service. Your municipality will provide helpful direction on this issue.
Make sure you have a clear description of any warranties. Know whether the contractor is providing a warranty on their workmanship. You should also know the warranty on the materials used in the renovation. Keep track of all product warranties and ensure that you register.
It’s prudent to include how you and your contractor will handle any disagreements or disputes. You can stipulate that mediation or third-party arbitration is required when disagreements cannot be resolved. The renovation contract can include a clause to outline the consequences for either side if you or the contractor fails to honour the contract. Additionally, if you’re embarking on a major renovation, have a lawyer go over the contract with you before you sign.
Hiring Bonded by eRenovate™ Pros and using the Project Tracker tool, will help you report and resolve disagreements.
More Helpful Tips:
- Before the renovation starts, ask your home professional for a list of expected inconveniences and then plan accordingly. For instance, will the HVAC, electricity and plumbing be turned off during the renovation?
- Established the preferred method of communication (phone, email, in-person) with your home professional.
- Move personal property from construction areas.
- Let your home professional know if you have pets.
- Seal off construction zones from liveable spaces. Declare all construction zones off-limits to children and pets.
- Consider living off-site during the renovation.
- Inform your neighbours of your renovation plans. Provide them with your contact information for any concerns about the renovation and in case of an emergency.
Refer to the eRenovate Renovation Guide to help you get the most out of your home renovation.
Hire Trusted Home Professionals. Connect with Bonded by eRenovate™ Pros by using the eRenovate Post My Project tool. Enjoy Peace of Mind with the eRenovate Guarantee which offers $25,000 Deposit Payment protection and 88 Day Workmanship Guarantee.