What is a Change Order and Allowance?

If It’s Not Documented, It Doesn’t Happen

library drawer with change order text

Remodeling can be a whirlwind of an experience. Endless conversations happen. Ideas flow back and forth. The homeowner gets more and more excited about their dream space and we get excited about making that dream a reality. Because of this we have an important tool to ensure all remain on the same page, the change order.

In the midst of all that, it’s easy for homeowners to change their minds. Maybe a material selection ends up looking different in real life than it did in their head. Or, maybe an idea came to them in the middle of the night, after we started working, and they wanted to change the plan.

This is fine. We can make changes. However, Homeworx has one important rule: All work must be stated in the proposal or in a change order.

We hope that our customers understand this. It is intended to protect our customers, as well as ourselves, from unexpected surprises.

The Process of Making Changes (Change Order)

Usually, customers don’t ask for changes until after the planning phase is completed. They often start to change their mind once the work begins. As the remodel takes shape, they start reconsidering the materials and reimagining the layout. Once they’ve made up their mind, they approach us and ask us to change directions.

Unfortunately, some of these changes may result in additional costs. Not all construction materials have the same cost, after all. In some cases, the change may require us to tear down preexisting work, so we’ll have to buy more materials.

Also, if the changes require additional labor, we’ll have to add to the final bill to compensate our team for their work.

So, when a customer wants to make changes, we issue them a change order. This invoice denotes any additional costs that will accrue during the project. It also outlines the exact nature of the changes, so that we and the customer are on the same page. Keep in mind change orders typically will be priced at a higher rate so we really want to finalize plans as much as possible before work begins. Also, change orders will likely extend the project timeline depending on the scope of the additional work.

Contractor Allowances

An allowance is noted on both the initial proposal and any subsequence change orders. The allowance notes the maximum amount of money that our customer allows us to spend on any material or item.

We are unable to begin working until we’ve come to an agreement with our customer on the allowance. The proposal and any change orders must be signed before we can move forward with the project.

What happens if HomeWorx goes over the allowance?

The homeowner will be notified of all costs ahead of time. During the initial planning phase HomeWorx will estimate allowances. As materials as chosen, actual costs will be entered into our proposal to keep it evergreen.

Any time a change order is issued, it will denote the full allowance. Both the customer and the contractor will agree on the amount before work commences.

What happens when HomeWorx uses less than the full allowance?

We do our best to create an accurate estimate of material and labor costs. The allowance reflects our estimate. If, for any reason, we spend less on materials and labor than we estimate, the untapped funds will be removed from the final bill.

Working Together to Make Dreams Come True

It’s important to us that our customers are happy. That’s why we’re willing to accommodate any and all changes to the proposal (within reason). However, in order to make sure that everyone’s expectations are aligned, all changes need to be documented. By working together, we can all make sure that your remodel comes out just the way you want it.

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