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 New Hampshire Construction Contract for Home, whether it is a fixed fee or cost plus, is a legally binding agreement between a homeowner and a contractor for the construction or renovation of a residential property in the state of New Hampshire. This contract outlines the terms and conditions under which the construction project will be undertaken, ensuring both parties' rights and responsibilities are clearly defined. The Fixed Fee contract is a type of construction contract wherein the contractor charges a predetermined, fixed amount for the entire project. This fixed fee includes all the labor, materials, and overhead costs required for completion. This contract is suitable for homeowners who want a clear and predictable budget for their construction project, as they have the assurance that the final cost will not exceed the agreed-upon fixed fee. On the other hand, a Cost Plus contract, also known as a Time and Material contract, is a type of construction contract where the homeowner reimburses the contractor for the actual costs incurred during the project, along with an agreed-upon percentage for profit or fee. This contract allows for flexibility in project scope and potential cost fluctuations, as the homeowner pays for the actual expenses incurred by the contractor. Both types of contracts have their merits and should be discussed and decided upon based on the specific needs and preferences of the homeowner. It is essential to thoroughly review and understand the terms and conditions specified in the contract to ensure a smooth construction process and avoid any potential disputes. Keywords: New Hampshire, Construction Contract, Home, Fixed Fee, Cost Plus, Residential property, Renovation, Terms and conditions, Contractor, Labor, Materials, Overhead costs, Budget, Reimbursement, Time and Material, Project scope, Cost fluctuations, Profit, Fee, Contractual agreement, Rights and responsibilities.
