8 Things to Include in Your Contractor Agreement

A contract is a legal agreement that outlines specific responsibilities and protects both the client and the home service professional. Once you have chosen your preferred contractor, look for these key areas to be defined in a written contract agreement:

License number

Before signing an agreement, check with your local municipality’s building division to verify that the contractor’s license is in good standing. In Toronto click here. You can use EiEiHome.com to find a well-regarded home service professional and learn why you should check your contractor’s reputation.

Scope of work

A detailed outline will help define the parameters of the work to be completed. It will also be important to note what is not included (ie. waste disposal). Both the homeowner and the contractor should clearly identify and establish details of work to be completed, including timelines and cost.

Payment plan

Decide beforehand how to pay your contractor and establish a sensible payment plan. Clear payment due dates are a must. Usually a payment plan will include several installments. The final payment should be held back until the job is completed to your satisfaction, as your contractor is more likely to return to finish the job to collect outstanding amount owing. Applicable interest fees should also be included to deal with possible late payments.

Timeline and dates

When you sign a contract, make sure you’re ready to fully commit to the project as if it were happening tomorrow. Progress milestones should be agreed upon and scheduled. This will reduce delays towards completion and will help you to maintain a positive relationship with your contractor. Some contractors will expect payment for undue delays in the process.

Permits and other considerations

Establish ahead of time who will be responsible for acquiring the proper architectural drawings and permits, if needed, for the work to begin. Sometimes additional drawings may be required for areas such as engineering, or heating, ventilation and air conditioning (HVAC). Decide who will source and pay for these items and services and put it in writing.

Warranty and insurance information

Your contractor should provide you with proof of insurance. If a warranty is offered, the conditions should be outlined in writing. If the job is not done to your satisfaction, you’ll want to be prepared to address the issue with established guidelines in place. Know how to deal with a contractor who doesn’t meet your expectations.

Changes to the scope of work

Your service pro agreement should include details on how change orders will be handled. Usually a formal change order request will need to be done in writing.

Signs and photography

Your contract might also contain a section devoted to granting permission to place signs on your property, or use photographs of your home. You are not required to consent to this if you choose not to.

The relationship between you and your contractor doesn’t need to be difficult. You can avoid potential problems by establishing a solid working agreement before the job begins. Cover these important aspects in a written agreement to help build a positive working relationship that will result in mutual satisfaction for both parties.

Share your tips below. What else should you cover in your contractor agreement?

By Shelley Kanitz



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