Should the contractor dispute being paid for the work, the homeowner has proof in the form of a signed release from the contractor, along with a cancelled check.Īlso, your contract’s payment structure can affect the propensity for conflict. “Conditional” as it is based on payment being satisfied, such as the check clearing your bank and the contractor receives payment. Referred to as a “Conditional Lien Release,” the contractor is essentially waiving his or her rights to filing a Mechanics Lien against your property for that portion of the job for which you are paying. This is why your contract should have a “ change order procedure,” which details the way in which both parties need to go about adding on any changes to the original construction plan.Īnother important step for homeowners to take is to require Lien Release Waivers when making payments to the contractor. Contractors and homeowners alike can’t predict every problem that’s going to arise along the way - issues behind walls, old pipes, or electrical wiring that’s not up to code will require extra spending and more time on behalf of your contractor. Why is this? Often project changes implemented during construction will add onto the total project cost and this can cause disagreements. Most Common Legal Disputes between Homeowners and ContractorsĬharles points out that the most common issues between homeowners and contractors involve payments and timeframes. If you’re considering a RenoFi Loan, just know that RenoFi performs meticulous due diligence on every homeowner’s contractor, so you can better avoid scenarios like these and have a great relationship with the contractor you work with. We also got input from Jody Costello, expert in protecting homeowners from unethical contractors. We sat down with seasoned construction attorney Charles Gallagher to discuss homeowner/contractor legal disputes to help homeowners better understand their options during these difficult situations. It’s not just money, it’s ownership over your living space that’s at stake. Therefore, when things go south, they really go south.Īlso, when homeowners get into disputes with builders and contractors, their physical property might be on the line - financially speaking. While other complaints about car troubles or shopping purchases are certainly common, home improvement projects are generally much more expensive. Why is this? Well, for one, home improvement projects are a huge financial investment. In fact, home improvement and construction projects took the #1 spot for worst consumer complaint of 2019. Whether it’s because of unfinished work, a disagreement on payment terms, or another difficult scenario, it’s certainly a harrowing experience for any homeowner considering involving a lawyer. The last thing anyone wants to do during a renovation is pursue legal action against a bad contractor.
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