Managing Change Orders on Remodeling Projects
The problem
Almost every remodel changes along the way: hidden damage, a different finish or an added outlet. When changes are agreed verbally on site, disputes follow at the final invoice. Clear change orders protect both the homeowner and the contractor.
The challenges
- Verbal agreements. Changes are approved in conversation and forgotten.
- Hidden conditions. Opening walls reveals problems no one could see.
- Schedule impact. Changes affect timelines as well as cost.
- Multiple decision-makers. Spouses or partners may disagree.
- Small changes add up. Many minor changes become a large total.
Opportunity cost of the status quo
Unbilled changes are lost revenue. Disputed changes delay final payment and damage reviews and referrals.
Illustrative arithmetic, not data: if a project has 8 small undocumented changes averaging $200, that is $1,600 that may be disputed or never billed. This is illustrative, use your own figures.
Industry solutions
Written change orders. Describe the change, price and schedule impact in writing.
Approval before work. Get a signature or written approval before proceeding.
Running total. Show the homeowner the cumulative effect of changes.
Contract terms. Explain how changes work in the original contract.
Photos of hidden conditions. Document what was found before proposing a fix.
Questions to answer before you change anything
- How are changes approved today?
- Does your contract explain the change process?
- Can homeowners see the running total?
- Who on the crew can approve a change?