The Terrors of the Time and Material Contract in Home Construction
The Terrors of the Time and Material Contract in Home Construction
There is a form of contracting prevalent in the home construction world that is very dangerous to the American homeowner. It is called the time and material contract. In construction slang it is known as “T & M.” This contract is the cause of run away costs on seemingly inexpensive home construction projects. The wise homeowner will be very, very wary of signing a time and material contract with any home construction contractor.
The basics of the time and material contract are quite simple. The contractor charges the homeowner for the actual time that all workers spend on the homeowner’s project plus all the costs of materials. The contractor’s profit is built into the hourly rate charged to the homeowner by the contractor for all of his workers. Sometimes a wily contractor will have the audacity to add a percentage as their fee or extra profit to the contract.
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