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Signing a contract and making a deposit

Before you sign any contract make sure all of the documents are gathered together and are fully completed.

There should be no blank spaces and the contract should include everything you have discussed with the builder. Do not rely on verbal promises or agreements.

Read all of the documents carefully and if you have any questions discuss them with your building work contractor. If you are not satisfied with the explanation he or she gives you, then seek advice from a solicitor or from Consumer and Business Services.

Once you have signed your domestic building work contract it becomes a legally binding agreement. Both parties should initial each page and initial every alteration or addition to the contract.

As a general rule, your building work contractor is entitled only to genuine progress payments for work done. However, your contractor may ask you to pay in advance for expenses that he or she has to pay to a third party. For example, to the council for planning approval, to pay building indemnity insurance or to pay an engineer or surveyor for a report. Apart from money paid in advance for such fees, the law prohibits the builder from taking a deposit of more than $1,000 on a domestic building work contract between $12,000 and $20,000 or 5% of the contract price for contracts $20,000 or more. If in doubt, seek advice before making any payments.


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