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Wednesday, December 12, 2012

Contractor Selection: Getting it Right In Writing

A message from Kyle Beil, HUNT Real Estate Corporation Realty Club Coordinator





After selecting a contractor through HUNT Real Estate Corp’s Vendor Network “The Realty Club,” be sure to look at the documents he, or she has prepared. Carefully examine the legal agreement - it should be professional, fair to both parties, and with your protection in mind contain the following:

Bid Price
Ask is this a cost of completion estimate, or one that flexes with the amount of labor hours spends on the project? Depending on your preferences one may be preferred over the other.

Payment Schedule
Be leery of a payment schedule tied to specific calendar dates. If possible opt for performance based payment, tied to the schedule of construction tasks.
Be sure it is contingent on your approval. This way you will be up to date on their progress, and not be financially tied to the contractor who started the project for finishing it.

Scope of Work
The devil is in the details. If it’s important to you, make sure it’s in there.

Site Plan
Very important if there will be any structural changes.

Sequential Schedule of Construction Tasks
Deadlines for completion do help to keep your project on schedule.
Please remember weather and some other factors are out of our control. Recognizing the need for flexibility can save a lot of headaches down the road.

Change-order Clause
Be sure your signature is needed for every change-order.

Procedural List for Close-out
This outlines the completion and settlement of the contract, including resolution of all outstanding items.

Express Limited Warranty
Be mindful an Expressed Limited Warranty is NOT a guarantee. It simply protects the consumer from defects in workmanship & from products not doing the task for which it was designed.

Clause about Dispute Resolution
Arbitration is becoming increasingly popular. However, given the two possible outcomes, consider who is ultimately responsible for paying the legal fees.

Waiver of Lien
Prevents subcontractors and suppliers from putting a lien on a house should their invoices go unpaid by the contractor.

Although there is a 3 Day Cooling Off Rule (with some exceptions), we strongly suggest you completely understand the agreement prior to signing any document. Making sure both your contractor and you are on the same page from day one is critical to creating a rewarding experience throughout the projects duration. Any questions, concerns, or feedback is encouraged and can be sent to kyle.beil@huntrealestate.com.



WORKS CITED
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"Federal Trade CommissionProtecting America's Consumers." The Cooling-Off Rule: When and How to Cancel a Sale. Federal Trade Commission, 24 Apr. 2009. Web. 03 Nov. 2012.

Garceau, Alicia. "How to Choose a Remodeling Contractor." : Page 02 : Decorating : Home & Garden Television. Scripps Networks, LLC, 2012. Web. 03 Nov. 2012.


"Glossary." Weblog post. Glossary. Financial Technologies (India) Limited, 2012. Web. 03 Nov. 2012.


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