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A person who performs labor or furnishes material with a value of $500 or more to be used in the construction, alteration or repair of your home has a lien upon the property in the event of an unpaid balance in the agreed upon amount or fair market value. As part of the disclosure prior to signing a contract, the contractor must inform the homeowner of the lien rights of labor, suppliers and subcontractors. Any person not paid for labor or materials furnished for a home-improvement project may obtain a lien against the homeowner’s property. A subcontractor or supplier who has not been paid by the prime contractor may obtain a lien even if the homeowner has paid the contractor in full.

Request that a contractor’s Affidavit of Final Release be provided to you at the time you make the final payment and a final waiver of mechanic’s lien. This is your assurance that you will not be liable for any third-party claims for nonpayment of materials or subcontractors.

REQUIRED DISCLOSURES
When you enter into a contract, there are certain disclosures that your contractor must provide to you in writing. Disclosures must be provided by the following:

General contractors
Residential contractors
Swimming pool and spa contractors

AFTER YOU HAVE HIRED A CONTRACTOR
Before work begins, make sure you have a complete and accurate set of contract documents. These should include the following:

You need a complete set of plans showing exactly what you are going to have built. It is suggested that you engage the services of a licensed architect or engineer to prepare these or at least review them to ensure their accuracy and completeness.
You need a complete set of specifications relating to the drawn plans. These should be prepared or reviewed by an architect or engineer.
You need a detailed contract with a set of general and accepted conditions and specifications. You may wish to have your attorney prepare these or review them prior to your signature. No work should be allowed until all documents are completed to your architect’s, attorney’s or your satisfaction.

Ask your contractor about inconveniences that may occur and plan for them. If a building permit is required for the job, make sure the contractor obtains it before the work starts and that it is posted at the jobsite. Do not pull or obtain the building permit yourself.

KEEP A FILE OF ALL DOCUMENTS RELATED TO YOUR PROJECT
Your file should include the following:

Signed contract and any signed change orders
List of all subcontractors and suppliers with contact information
Plans and specifications
Copies of building permits and inspections
Cancelled checks and records of payments
Record of all work performed and time on the job
Delivery receipts for materials from suppliers
Lien releases from materials suppliers and subcontractors (When you receive lien releases from subcontractors or materials suppliers, check them against your records. Your paperwork will help you determine who has and has not been paid.)

MAKE SURE ALL CHANGE ORDERS ARE IN WRITING
Plan carefully and keep changes to an absolute minimum. Change orders are very expensive for both the homeowner and the contractor and will increase the cost of the project. If you must make change orders to the original specifications, they should be in writing and signed by both you and the contractor.

PREPARE A “PUNCH LIST”
Write a list of minor work that needs to be completed or repaired. Do not engage in verbal agreements for repairs or additional work.

PROPER PLANNING IS IMPORTANT
For considerably less money than a new home, careful planning of improvement projects will let you update your home, increase the value of your investment and customize your living space. As part of the planning process, look over your property carefully. What repairs are needed? What improvements would you like to make? Think ahead and determine your future needs. Professional remodeling contractors can help you in your planning by outlining options and discussing the improvements you can make within your budget. Be sure to review your homeowners insurance policy and make adjustments for the added value of the work being done.

THINK ABOUT DESIGN AND FUNCTION
Design and function should be foremost in your mind if you’re thinking of adding a room or converting an existing one. When planning a larger, more complicated project, give thought to details, such as intended use of the space; flow of the space; where you want electrical outlets, telephone jacks and cable hook-ups located; the type of lighting required; your current and future storage needs; and whether you want to include luxury items. These details will enable your home improvement to better suit your needs and your lifestyle.