Franklin County Home Care Corporation
helping elders and caregivers live better lives

How to Hire a Contractor - Part 2

Recommendations for the Building Owner When Selecting a Contractor to Perform Work on an Existing Home

Before you enter into any written agreement to construct a new home or to remodel or build an addition onto an existing home:

1. Ensure that the Contractor is appropriately licensed and is a Licensed Registered Home Improvement Contractor.

2. Ensure that the contractor has adequate liability insurance and workers compensation insurance.

3. Ask the contractor for a written list of his/her three most recent projects with names, telephone numbers and addresses of the owners.

4. Call the owners and ask questions about the performance of the contractor.

5. Check with your local Better Business Bureau, the Board of Building Regulations and Standards and the Office of the Attorney General to find out whether the contractor has any complaints filed or whether or not any disciplinary action has been taken against the contractor, or check this Massachusetts web site.

6. Elders may request that the contractor produce a recent Criminal Offender Record Investigation (CORI check) for everyone who may be working in and around their home.

1. Do not enter into any construction agreements without a written contract. Before signing a contract make sure that your attorney reviews the contract.

2. Ensure that you authorize the contractor to apply for the building permit as your agent. Registered Home Improvement Contractors are required by law to apply for all building permits which are subject to the Home Improvement Registration Law.

3. We strongly caution building owners against applying for their own building permit. Reputable contractors will apply for the permit, acting as the owner's agent and with the owner's written authority. Only a Home Improvement Contractor Registrant may apply for a building permit for work covered by the state program. Your contractor may need BOTH the license AND the registration depending upon the type of work being performed. If a contractor is reluctant to apply for the building permit on your behalf it may be an indication that the contractor does not possess a license or a registration. (a link to the Mass State web site that lists all licensed Home Improvement contractors is in Section 3 of the Home Repair Guide). NOTE! for home improvement work covered by Chapter 142A of the General Laws you are EXCLUDED from reimbursement of up to $10,000 from the guaranty fund if you apply for your own building permit or if you do business with an unregistered contractor.

Contracts

All contracts over $1,000 (One Thousand Dollars) must be in writing.

The law requires the following FOURTEEN items to be included in any contract between the homeowner and registered home improvement contractor in all contracts for home improvement work subject to the state law, MGL c 142A.

1. The complete agreement between the contractor and the owner and a clear description of any other documents which are part of the agreement.

2. The full names, federal I.D. number (if applicable), addresses (NOT P.O. Box numbers), of the parties, the contractors registration number, the name(s) of the salesperson(s) involved, if any and the date the contract was executed by the parties.

3. The date on which the work is scheduled to begin and the date the work is scheduled to be substantially completed.

4. A detailed description of the work to be done and the materials to be used.

5. The total amount agreed to be paid for the work to be performed under the contract.

6. A time schedule of payments to be made under the contract and the amount of each payment stated in dollars, including all finance charges, if any. Any deposit required to be paid in advance of the start of the work SHALL NOT EXCEED one-third of the total contract price or the actual cost of any material or equipment of a special order or custom made nature, which must be ordered in advance of the start of the work to assure that the project will proceed on schedule. No final payment shall be demanded until the contract is completed to the satisfaction of all parties.

7. All parties must sign the contract.

8. There shall be a clear and conspicuous notice stating:

   1. That all home improvement contractors and subcontractors shall be registered and that any inquiries about a contractor or subcontractor relating to a registration should be directed to:
      Registration Division, Program Coordinator
      One Ashburton Place Room 1301
      Boston, Ma 02108
      Tel: (617) 727-3200 ext. 25239 

   2. The contractor's registration number must be on the first page of the contract

   3. the homeowners three day cancellation rights under MGL c 93 s 48; MGL c 140D s 10 or MGL c 255D s 14 as may be applicable.

   4. All warranties on the owner's rights under the provisions of 780 CMR R6 and MGL c 142A

   5. In ten point bold type or larger, directly above the space provided for the signature, the following statement:
      DO NOT SIGN A CONTRACT IF THERE ARE ANY BLANK SPACES.

   6. Whether any lien or security interest is on the residence as a consequence of the contract. 

9. An enumeration of such other matters upon which the owner and contractor may lawfully agree.

10. Any other provisions otherwise required by the applicable laws of the Commonwealth.

11. Permit Notice: Every contract shall contain a clause informing the owner of the following:

    1. any and all necessary construction-related permits;

    2. that it shall be the obligation of the contractor to obtain such permits as the owner's agent.

    3. that owners who secure their own construction-related permits or deal with unregistered contractors shall be excluded from access to the Guarantee Fund.

12. Acceleration of payment: No contract shall contain an acceleration clause under which any part or all of the balance not yet due may be declared due and payable because the holder deems himself to be insecure. However, where the contractor deems himself to be insecure he may require as a prerequisite to continuing said work that the balance of funds due under the contract, which are in possession of the owner, shall be placed in a joint escrow account requiring the signatures of the home improvement contractor and the owner for withdrawal.

13. No work shall begin prior to the signing of the contract and transmittal to the owner of a copy of such contract.

14. Arbitration: If the contractor determines that in the event of a dispute, the contractor wishes the dispute to be settled by arbitration, this fact must be signified on the contract and both the contractor and owner shall sign this clause separately. The following format is acceptable (in 10 point type or larger):
    "The contractor and the homeowner hereby mutually agree in advance that in the event that the contractor has a dispute concerning this contract, the contractor may submit such dispute to a private arbitration service which has been approved by the Office of Consumer Affairs and Business Regulation and the consumer shall be required to submit to such arbitration as provided in MGL c 142A.
    Owner:___________________________________________
    Contractor:________________________________________
    NOTICE: The signatures of the parties above apply only to the agreement of the parties to alternate dispute resolution initiated by the contractor. The owner may initiate alternative dispute resolution even where this section is not signed separately by the parties."
    
    (This document is taken from the State of Massachusetts Web site & FCHCC)

Return to Part 1 - List of Tradespeople