Builders Contracts Templates: Everything You Need to Know
A building contracts template can be used to draft and sign the actual contract before any building or renovation work is started. A building contract is an agreement between a property owner and a contractor that outlines the construction or work to be done, usually the building or renovation of a home.3 min read
A building contracts template can be used to draft and sign the actual contract before any building or renovation work is started. A building contract is an agreement between a property owner and a contractor that outlines the construction or work to be done, usually the building or renovation of a home.
By entering into a contract, buyers, property owners, contractors, and construction firms are fully aware of each party's expectations regarding performance, materials, schedule, and finances. Utilized by both contractors and owners, a construction contract also ensures both parties are protected in the event of any delays and misunderstandings and remove unnecessary uncertainty and stress.
Building Contract Template
A building contract template can be used for home renovation projects including extensions, house building, and more. A customizable building contract template can be useful in laying out preliminary instructions, responsibilities, and any resolutions to disputes of the project. A good building contract provides direction that helps avoid disputes and misunderstandings by providing a clear framework for both parties to comply with. The contract can be drafted by the homeowner, the contractor, the homeowner and contractor together, or by a certified legal professional, like an attorney.
A solid building contract template allows you to personalize the contract to address your specific needs and circumstances while containing the necessary requirements of the contract including:
- A clearly defined set of terms and conditions, including the agreement describing the obligations of each party, payments terms, and a basic clause addressing any legal obligations and dispute resolutions
- A description of the contract documents
- A space for the parties' signatures and the date
Terms and Conditions
Spelling out the specifics of the contract in its entirety, the terms and conditions, or T&C, is one of the most important parts of the contract. A building contract covers the following:
- The scope of work – a description of the work to be done including, a process of sourcing materials and assessing the quality of the work
- Obligations, responsibilities, and duties of both parties
- Modifications – and a process for changing orders, designs, and materials
- Completion Time – including a description of the timeline of the project, expected completion date, process to manage delays
- Contract Price & Payments – including final price, payment schedules and amounts, and resolution process for resolving contract price or payments
- Insurance and indemnity policies and procedures, including applicable documents
- Compliance - for the contract to be valid, it must comply with the laws and regulations of the state where the work will be done. A simple declaration attesting that the contract will be held to applicable state laws should be included
- Arbitration - the contract should include provisions addressing the resolution of disputes. Dispute resolution options include mediation, arbitration, or court involvement.
Contract documents are addendums that explain or detail certain provisions in the contract concerning designs and materials to be used. Any plans referenced in the T&C should be included in the contract documents section. Additionally, the following items should be included in this section of the building contract template:
- Architectural plans and drawings including, building and completion plans and specifications
- Allowable material Items
- Applicable permits
Without the signature of both parties, the contract isn't a binding legal document. By signing the contract, both parties are acknowledging that they agree to enter into this contract and perform as stipulated in the terms. Depending on your state, the contractor will need to include his or her license number. Lastly, the date the document is signed by both parties should also be listed as it is required.
A thorough, clearly detailed building contract is the first steps to a successful building or construction project. Not only does it provide a solid foundation for moving forward with the good understanding of project expectations, it provides valuable protections.
To ensure you're starting your project on a good foot, both you and the other party should consult with a qualified legal advisor prior to signing the contract to ensure it covers all applicable legal requirements.
If your project has special requirements that are not covered by a standard builder contract template, or you want to receive some advice before you proceed, you can post your legal need or job on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.