This form is a Construction Contract. The form contains the following subjects: scope of work, work site, and insurance. The contractor's warranty is limited to defects in workmanship within the scope of the work performed by the contractor.
What is a Construction contract agreement?
If you’re planning to build, renovate or reconstruct your house, you will need to enter into a contract for home construction with the building contractor, defining your mutual rights and responsibilities. This agreement contains project specifics, the contractor’s license and insurance details, the requested scope of work, etc. It may also determine the potential lien on the property should the work not be paid in full.
Types of construction contracts
Depending on the payment arrangements determined by parties, there are four basic types of home builders’ contracts:
1. Fixed price (or lump-sum) agreements set the price for the completed job right from the start. Although fixed, the document may also include provisions defining penalties (for example, if the constructor fails to finish the work on schedule).
2. Cost plus construction agreements set the price for the finished work based on building materials and labor with additionally mentioned “plus” (a percentage of the total costs or a fixed fee).
3. Time and material agreements set the price for the work without a “plus,” but the client pays the contractor a daily or hourly rate while they are under contract.
4. Unit-price agreements are standard in bidding, particularly for federal building projects. Both owner and contractor define the price that the contractor charges for a standard unit without any specific extra fees for other units.
The first two types of contract for home construction mentioned are the most popular ones. Let’s take a closer look at them.
Fixed price vs. cost-plus contract benefits
The fixed price agreement benefits owners more than builders, as it determines at the moment the parties seal the deal the exact price the contractor will get after they complete all the work. Builders risk not getting the estimated profits they initially anticipated, as expenses may increase significantly but remain the constructor’s responsibility.
The cost-plus construction deal contains the evaluation of the final project cost; however, it doesn’t determine the final contract price until the contractor completes all the work. Unlike the fixed-price agreement, it separates expenses and sets the profit rate (as a percentage of the final project cost or as a flat amount), so contractors prefer this type of agreement; it is riskier for homeowners.
Information you should provide in the construction contract agreement
The presented Construction Contract for Home is a universal multi-state construction contract template. This sample describes typical terms for a home building contract. Download a printable document version from our website or amend and fill it out online. Make sure to provide the following information:
• Name and contact details of the contractor and their license number;
• Name and contact details of the homeowner;
• Property legal description from county clerk’s records;
• Project description with blueprints and building specifications;
• Scope, description of work, and its estimated final dates;
• Costs of work and responsibilities of parties for any breach of contract.
A Nebraska Construction Contract for Home — Fixed Fee or Cost Plus is a legally binding agreement between a homeowner and a construction contractor in the state of Nebraska for the construction or renovation of a residential property. This type of contract outlines the terms and conditions of the project, including the scope of work, payment details, and any other relevant provisions. The two main types of Nebraska Construction Contracts for Homes are Fixed Fee and Cost Plus contracts. 1. Fixed Fee Contract: In a Fixed Fee contract, the homeowner and contractor agree upon a specific amount, known as the fixed fee, that will be paid for the entire project. This fixed fee is predetermined and includes all costs and expenses related to the construction or renovation work. It provides a sense of certainty for the homeowner, as they know the exact amount they will pay for the project. 2. Cost Plus Contract: In a Cost Plus contract, the homeowner agrees to reimburse the contractor for the actual costs incurred during the construction or renovation process, along with an additional fee or percentage of the costs, which is usually agreed upon in advance. This type of contract is useful when the project's scope of work is uncertain or when unforeseen expenses may arise during construction. It provides more flexibility for both parties but can potentially lead to higher costs for the homeowner. Regardless of the type of contract chosen, a Nebraska Construction Contract for Home typically includes the following key elements: 1. Project Description: This section provides a detailed description of the work to be performed, including the materials, design plans, and any specific requirements or specifications provided by the homeowner. 2. Scope of Work: The scope of work outlines the specific tasks and responsibilities of the contractor, including construction and renovation work, obtaining permits and approvals, and coordinating with subcontractors or suppliers. 3. Payment Terms: This section specifies how the homeowner will make payments to the contractor, whether it is in installments, at specific milestones, or upon project completion. It may also include provisions for change orders or any additional costs that may arise during construction. 4. Termination Clause: This clause outlines the circumstances under which either party can terminate the contract, such as non-performance, default, or breach of contract. It provides a mechanism for resolving disputes and ensures that both parties have an exit strategy if needed. 5. Indemnification and Insurance: The contract may include provisions for indemnification, stating that the contractor will be responsible for any damages or liabilities arising during the construction process. It may also require the contractor to maintain adequate insurance coverage to protect against any accidents or injuries that may occur on the project site. 6. Dispute Resolution: This section outlines the process for resolving any disputes that may arise during the project. It may include provisions for mediation, arbitration, or litigation, depending on the preferences of the parties involved. By using these relevant keywords, such as Nebraska Construction Contract for Home, Fixed Fee, Cost Plus, project description, scope of work, payment terms, termination clause, indemnification, insurance, and dispute resolution, this detailed description provides an understanding of the different types of contracts and key elements included in a Nebraska Construction Contract for Home — Fixed Fee or Cost Plus.
