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Educational Consumer Tips

Home Builder and Remodeler Contract Tips

Author: Better Business Bureau

The BBB suggests that you solicit two or three bids for the work or project, but do not automatically accept the lowest offer. Make sure all bids are based on the same set of specifications and materials to be used. Ask for references and inspect finished projects. Make sure the contractor or company is in compliance with all local licensing, bonding and insurance requirements and that any necessary building permits are obtained.

Never sign a blank or partially blank contract. Before paying, get a sworn statement that all bills for material and labor have been paid for by the contractor. Typically a down payment of one third of the total contract price is made with additional payments made after completion of each phase of work. Final payment should not be made until the job is completed and you have inspected the work.

If the work or project is to be financed, be sure to have complete details of the financing agreement, especially if a second mortgage of your home is used as security for the remodeling work.

According to the S.C. Notice and Opportunity to Cure Construction Dwelling Defects act effective July 2, 2003, requires that prior to filling any formal legal action against a builder/contractor, a homeowner must no later than 90 days prior to filing a formal action serve a written notice of claim on the builder/contractor alleging any construction defects in a residential dwelling. After receipt of such notice, the builder/contractor has 30 days to respond and offer a remedy or deny the claim.