A written contract is something you shouldn’t forget to request before the actual work begins. This document defines the agreement between two parties, their expectations, as well as their risks and obligations. It provides a legal binding agreement between the owner and contractor, that the accomplished work will receive a certain amount of compensation or how this payment will be divided.
Read on to learn more about the different types of construction contracts from one of the area’s best full bathroom remodeling contractors.
Also called fixed-price contracts, lump-sum contracts are the most common type of remodeling contract. It usually states one fixed price for the entire project it covers, a reason it’s very common in construction. This type of contract makes bidding simpler as it involves giving a total price instead of submitting different bids.
Time and Materials Contracts
Unlike lump-sum contracts, time and material (T&M) contracts are ideal for projects where the scope of work is not defined well. They compensate contractors for the cost of materials and have an hourly or daily pay rate.
Unit Price Contracts
Some home remodeling or small bathroom renovation companies also call unit price contracts measurement contracts, measure and pay contracts, or remeasurement contracts. In this type of contract, the contractor gives the owner price quotes for every unit of work instead of an estimate for the project as a whole.
In cost-plus or cost-reimbursement contracts, homeowners pay the contractor for the costs incurred during the construction and a set amount of money for profit. A percentage of the overall project cost determines how much additional cost you need to pay the contractor besides the materials.
At Envy Home Services, we’re here to help with all your home remodeling needs. We are one of the area’s leading tub to shower remodelers. Give us a call at (888) 847-7954 or fill out our contact form for a free quote.