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What to Do Before Starting a Construction Project
Have you ever found yourself in a situation where you hired a contractor to remodel your house, let’s say your kitchen, and things don’t seem to go as planned? The project was estimated to take six weeks and here you are six months later. The work isn’t complete, the work that has been completed looks shoddy, and you’ve already paid the contractor the entire contract sum. This scenario describes a commonly experienced problem amongst homeowners all over the state and has led to unending headaches. For those of you looking to tackle a new construction project, rest assured there are ways to minimize problems on the job. Before you start any home renovation project, check off the following 13 “make sures.” This list is not intended to be exhaustive.
- Make sure you are contracting with somebody reputable. Get a few recommendations from reputable sources such as from Realtors, bankers, or people who’ve used the contractor in the past, but don’t stop there: conduct your own due diligence.
- Make sure the contractor and their subcontractors are licensed. Hiring a non-licensed contractor increases the chances of substandard work or work that doesn’t meet the Florida Building Code.
- Make sure the contractor is insured. If your property is damaged during the construction, you need recourse. Ask for a certificate of insurance and then call the insurance company to verify the validity of the policy.
- Make sure you have the contractor list you as an additional insured on their commercial general liability policy. This provides you additional insurance coverage often without paying additional premiums.
- Make sure the contractor shows you their workers compensation certificate. You don’t want to be responsible for a worker injured on your property.
- Make sure you obtain a builders risk insurance policy. This policy is intended to protect against a loss to the property during construction. Consult with an insurance agent.
- Make sure you have a written contract. Most homeowners do not have a written contract and that opens the door to countless problems.
- Make sure the contract defines the scope of work, that is, what the contractor is supposed to be providing you under the contract. Failing to include a scope of work will invite arguments over what was supposed to have been performed.
- Make sure the contract specifies a written procedure for adding or subtracting items from the scope of work, known as a “change order.” You don’t want a contractor adding things to the contract that you didn’t expect and claiming you must pay him/her for the extra work.
- Make sure the contract specifies a timeframe for completion of the job, otherwise the job may extend on for months longer than it should.
- Consider a liquidated damages provision for delays on the job to help ensure timely completion of the work. For example, assessment of $50 per day for each extra day.
- Make sure the contract includes a payment schedule where incremental progress payments are made after certain milestones are reached. For example:
10% Receipt of building permit
10% Completion of new of new floor slab
10% Completion of block wall and tie beam
10% Completion of roof felt dry-in
15% Completion of rough mechanical, electrical and plumbing
10% Completion of drywall
10% Completion of floor tile and cabinetry box installation
10% Completion of finishes
5% Completion of final inspections
- Make sure the contractor warranties the work.