“Change order”—it’s a common phrase you hear contractors throw around, and one you may be unfamiliar with if you don’t have extensive experience with the construction industry. But when choosing a contractor for your home improvement project, the concept of a change order is an important one to understand.
In simple terms, a construction change order is additional work added to the work already outlined in your contract, and it generally raises the original estimate or prolongs the agreed upon completion date. A contractor will issue a change order to cover special or unforeseen costs that arise during construction. There are both acceptable and unacceptable reasons a change order may be requested.
Unacceptable Reasons for a Change Order
Inaccurate estimates. An inexperienced or dishonest contractor can neglect to include key costs in their initial estimates, intentionally or otherwise. Your contractor’s estimate may not cover key details, such as the cost of obtaining a permit, installing electrical work, or conducting repairs and cleanup at the end of the job. When these issues arise, the contractor may issue a change order to raise the price of the initial estimate.
Unforeseen issues. Similarly, an inexperienced contractor may not be able to anticipate all of the potential complications and obstacles associated with your kind of project, such as soil problems, mildew, and inclement weather. When this happens, your contractor may issue a change order to cover the cost of handling these problems despite it being their responsibility to anticipate and prepare for all reasonable complications that could arise.
Substitution. A licensed deck builder may decide to use a substitute material if the material originally specified in the contract is unavailable or there is a shortage in supplies. In this case, a contractor may issue a change order to cover the cost difference.
Inefficiency. If your contractor’s team is inefficient, they may be unable to finish your project within the budget they initially proposed to you. When this happens, your contractor may submit a change order requesting additional money or time.
Acceptable Reasons for a Change Order
Additional features. If a customer requests additional work during the process of construction—such as an increase in square footage or the addition of special features— a change order may be issued to cover the cost of the upgrade.
Extreme complications. A quality contractor should be able to anticipate common problems and issues that could arise during construction, and include accommodations for such complications in their initial estimate. However, there are certain extreme complications that typically cannot be reasonably accounted for, such as the discovery of black mold or asbestos.
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Whatever the cause, change orders can tack a lot of time and money to your project. However, a quality, experienced, and organized builder should be able to avoid the need for them almost entirely.
That’s why it is essential to hire the right people to construct your addition or outdoor living space without unexpected expenses popping up over the course of your project. Also be sure to review their estimate thoroughly. Their initial bid should include material, scope, and size, and cover important details such as the cost of a permit, interior and exterior cleaning and repairs, and any special tasks or issues that could arise. Be wary of vague contracts that leave room for interpretation.
When interviewing your contractor, be sure to ask him or her whether they anticipate any change orders arising during the project. If they experienced and knowledgeable, their answer should almost always be “not unless you decide you want additional work done or special features added over the course of construction.”