A home improvement contract is a legally binding agreement between a homeowner and a contractor for renovation, remodeling, or repair work. In California, strict laws protect homeowners from fraud and unfair business practices. Whether you’re hiring a contractor for a kitchen remodel, roof replacement, or landscaping project, understanding your rights and contractor obligations is essential. In this blog post, we’ll explain California home improvement contract laws, required terms, and tips for avoiding disputes.
What Is a Home Improvement Contract?
A home improvement contract is a written agreement for construction, repair, or renovation work on residential property. Under California Business and Professions Code § 7159, these contracts must meet specific legal requirements.
When Is a Written Contract Required?
A written home improvement contract is required in California when:
- The total cost of the project exceeds $500.
- The work includes materials, labor, and services.
- The contractor is licensed by the Contractors State License Board (CSLB).
Key Requirements for a Legal Home Improvement Contract
1. Contractor License Information
- The contractor must include their CSLB license number and contact information.
- Always verify the contractor’s license status at www.cslb.ca.gov.
2. Detailed Scope of Work
- The contract must clearly describe the work to be done, materials used, and project timeline.
- Vague descriptions can lead to disputes.
3. Payment Schedule and Limits
- Down payments cannot exceed $1,000 or 10% of the total contract price, whichever is less.
- Progress payments should align with completed work stages, not arbitrary deadlines.
4. Right to Cancel
- Homeowners have three business days to cancel a home improvement contract without penalty under California’s “Cooling-Off Rule.”
5. Warranties and Guarantees
- If the contractor provides warranties on materials or labor, they must be in writing.
- Ensure the contract specifies who is responsible for any defects or repairs.
How to Avoid Home Improvement Scams
- Verify contractor credentials through the CSLB website.
- Avoid paying large upfront fees—legitimate contractors follow state deposit limits.
- Get everything in writing, including changes or modifications.
- Beware of unlicensed contractors offering unusually low prices.
A home improvement contract protects both homeowners and contractors by setting clear expectations and legal obligations. Before signing any agreement, review all contract terms carefully and ensure your contractor complies with California law. If you are dealing with contractor disputes, payment issues, or construction defects, Law Advocate Group, LLP can help. Contact us today for expert legal guidance on home improvement contracts.
