What Every Home Improvement Contractor Should Know

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If you’re in business as a home improvement contractor, you already know how much hard work and sweat you put in on a daily basis.  Without question, you expect your customer to pay for your services.  Therefore, you need to be proactive from the beginning of your job.

First and foremost, remember that you are a professional.  Just because you feel it’s a trusted friend who has asked you to remodel her bathroom, you should not forego any formalities.  For starters, this means getting the numbers straight.  Meanwhile, it also is essential that you both agree to the terms and conditions by executing a written contract.

Every home improvement contractor should also know that New Jersey law is favorable to consumers.  With that in mind, it is crucial that you have at least a basic understanding of the New Jersey Consumer Fraud Act.

Home Improvements and the NJ Consumer Fraud Act

When home improvement contractors offer customers a contract, they need to make sure it is in compliance with the New Jersey Consumer Fraud “CFA”.   Additionally, when performing home improvement services, you should also ensure that you are cognizant of issues that may be used as a reason to forego payment.

When it comes to home improvement contractors, there are fundamental expectations under the CFA.  As a result, any of these acts may be considered consumer fraud:

  • Affirmative Misrepresentation: Contractor either negligently or unintentionally misrepresented some portion of the job.
  • Knowing Omission: Contractor is aware that he will not be able to comply with a portion of the contract, but still enters into it without letting the consumer know potential issues. For example, telling a client that the work will be finished by the holidays could be a knowing omission if it is an impossible deadline.
  • Violation of Particular Regulations: There are a number of legal requirements for home improvement contractors. At the very least, the New Jersey Department of Consumer Affairs provides details as to what types of home improvement contractors need to be registered with the state.

Home Improvement Contracts

All things considered, it is critical that home improvement contractors consult with an experienced business attorney for contract review.   Additionally, insurance is an important concern.  First, there is the issue of workers compensation insurance for your employees.  However, you also need to prove you have liability insurance.  This is important to you and the consumer.

These are just the basics as far as what you need in your contract.   Your state registration number is also a critical part of the contract.  When you make references to price, time and materials, realize you are bound by the language in the signed agreement.

Non-Payment for Services

Why such an emphasis on contracts and the New Jersey Consumer Fraud Act?  If your customer does not pay you, you may decide to pursue collection efforts.  You don’t want to leave anything to chance.

In some cases, the customer may say they withheld payment because you were not in compliance with the CFA.   This is when the contract will become extremely important.

Contact Us

At the Law Offices of Lawrence M. Centanni, we have experience working with home improvement contractors.  We can help you make sure that your contract is in compliance.  Additionally, we can assist with commercial litigation and collection efforts.  Contact us to schedule an appointment.

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