Contractor Contract Checklist: Essential Terms for Washington Homeowners

A strong contract is your primary protection in any construction project. Washington State has specific requirements for contractor agreements, and missing key provisions can leave you vulnerable if things go wrong.

This checklist covers what every Washington home improvement contract should include—and what red flags signal trouble ahead.

Washington State Contract Requirements

Under RCW 18.27.114, contractor contracts in Washington for projects over $1,000 must include:

1. ✅ Contractor's name, business address, and contractor registration number
2. ✅ Starting date and substantial completion date
3. ✅ Total contract price (or method to calculate it)
4. ✅ Description of work to be performed
5. ✅ Payment schedule tied to milestones

Failure to include these required elements can give you legal leverage if disputes arise.

Essential Contract Terms Checklist

Identification and Licensing

Must have:

• Contractor's full legal business name
• Contractor's physical address (not just PO Box)
• Washington contractor registration number (verify at verify.lni.wa.gov)
• UBI (Unified Business Identifier) number
• Name of individual signing the contract

Verify before signing:

• License is active (not expired, suspended, or revoked)
• Bond is current
• Insurance certificates are valid

Scope of Work

The scope of work is the heart of your contract. Vague scope creates change order disputes.

Must have:

• Detailed description of all work to be performed
• Specific materials listed (brand, model, grade)
• Plans and drawings attached and referenced
• What's explicitly NOT included (exclusions)
• Who provides what (owner vs. contractor responsibilities)
• How allowances are handled and amounts

Example of bad scope: "Remodel kitchen to owner satisfaction."

Example of good scope: "Remove existing cabinetry, countertops, flooring, and backsplash. Install: Kraftmaid Durham cabinets (maple, natural finish) per attached layout drawing A-1. Countertops: 3cm Calacatta quartz with eased edge. Flooring: Shaw Landmark vinyl plank (color: Wayward) per spec. Backsplash: 3x6 subway tile in White Glossy, herringbone pattern. All installations per manufacturer specifications. See Exhibit A for complete specifications."

Timeline and Milestones

Must have:

• Start date (or how it will be determined)
• Substantial completion date
• Key milestones with dates
• Allowance for delays (weather, permitting, owner-caused)
• What happens if delays occur
• Notice requirements for schedule changes

Include if applicable:

• Working hours (when crews can be on site)
• Weekend/holiday work restrictions
• Liquidated damages for late completion (if negotiated)

Pricing and Payment

Must have:

• Total contract price (fixed) OR method to calculate price (T&M)
• Payment schedule tied to completion milestones
• Deposit amount (Washington doesn't limit this, but >10% is a red flag)
• What triggers each payment
• Retention amount (typically 5-10% held until final completion)
• When final payment is due

Good payment schedule example:

• 10% upon signing
• 20% upon demolition completion
• 25% upon rough-in inspection
• 25% upon substantial completion
• 10% upon final walkthrough and punch list completion
• 10% retention released 30 days after final completion

Never agree to:

• Full payment upfront
• Large deposits (>20%)
• Payment before work is complete
• Payment tied to dates rather than milestones

Change Orders

Changes happen. Your contract should address how.

Must have:

• Change orders must be in writing
• Both parties must sign before work proceeds
• How costs are calculated (labor rate, material markup)
• Timeline impact assessment
• What happens if owner requests changes

Sample change order clause: "No changes to scope, price, or schedule shall be effective unless documented in a written Change Order signed by both parties prior to performing the changed work. Change Order pricing shall be calculated at $X/hour for labor plus materials at cost plus 15%."

Permits and Inspections

Must have:

• Who obtains permits (typically contractor)
• Who pays permit fees (typically included in contract)
• Contractor responsible for code compliance
• Contractor schedules all inspections
• Owner receives copies of all approved inspections
• Work must pass final inspection before final payment

Insurance Requirements

Must have:

• Contractor maintains general liability insurance
• Minimum coverage amounts specified ($1M minimum common)
• Contractor maintains workers' compensation (or proof of exemption)
• Owner listed as additional insured on liability policy
• Certificate of insurance attached or provided within X days
• Contractor notifies owner if insurance lapses

Warranties

Must have:

• Contractor warrants work against defects (minimum 1 year)
• Materials warranted per manufacturer terms
• How warranty claims are submitted
• Response time for warranty work
• What's not covered (abuse, normal wear, owner modifications)

Washington minimum warranty by law: The Washington Contractor Registration Act doesn't mandate specific warranty periods, but common law implies warranties of workmanship. Get it in writing.

Dispute Resolution

Must have:

• Process for resolving disputes
• Mediation or arbitration requirements
• Which state's laws govern (should be Washington)
• Where disputes are heard (your county)
• Attorney's fees provisions (prevailing party recovers)

Caution: Mandatory binding arbitration can limit your legal options. Understand what you're agreeing to.

Termination Provisions

Must have:

• Owner's right to terminate (with notice)
• Payment obligations upon termination
• Contractor's right to terminate (if not paid, etc.)
• What happens to materials on site
• Process for determining work completed
• Owner's right to hire another contractor

Safety and Compliance

Must have:

• Contractor maintains safe work site
• Contractor complies with WISHA (Washington Industrial Safety and Health Act)
• Contractor responsible for securing the site
• Contractor carries required first aid and safety equipment
• Contractor follows COVID/health protocols if applicable

Cleanup and Site Conditions

Must have:

• Daily cleanup requirements
• Dust and debris containment
• Final cleanup included in contract
• Protection of existing finishes
• How damage to existing property is handled

Communication

Should have:

• Primary contact for each party
• Expected response times
• Regular meeting schedule (weekly, etc.)
• How decisions are communicated and documented
• Photo documentation requirements

Red Flags in Contracts

Reject any contract that:

• ❌ Has no cancellation clause or right to terminate
• ❌ Requires payment in full upfront
• ❌ Uses vague scope language ("as needed," "to satisfaction")
• ❌ Doesn't list the contractor's license number
• ❌ Waives your right to file a lien or bond claim
• ❌ Has no warranty or limits warranty to 30 days
• ❌ Specifies another state's laws govern
• ❌ Contains automatic renewal clauses
• ❌ Requires disputes be heard in another city/state
• ❌ Has blank spaces in dollar amounts or dates
• ❌ Is handwritten without clear terms

Before You Sign

Verify

• Contractor license active at verify.lni.wa.gov
• No serious L&I complaints or violations
• Insurance certificates are current (call the insurer to verify)
• References checked from recent similar projects
• You understand every clause

Get Copies

• Fully signed contract
• All exhibits (scope, plans, specifications)
• Payment schedule
• Insurance certificates
• Warranty documents
• Lien waiver forms (for each payment)

Rights You Cannot Waive

Washington law protects homeowners even if your contract says otherwise:

• Right to file a complaint with L&I
• Right to file against the contractor's bond
• Right to lien waivers with each payment
• Mechanics lien rights

Sample Clauses

Entire Agreement

"This Contract, including all exhibits and attachments, constitutes the entire agreement between the parties and supersedes all prior negotiations, representations, or agreements. No modification shall be effective unless in writing signed by both parties."

Washington Law

"This Contract shall be governed by and construed in accordance with the laws of the State of Washington. Any disputes shall be resolved in the courts of [Your County], Washington."

Lien Waivers

"Contractor shall provide a conditional lien waiver with each progress payment request and an unconditional lien waiver upon receipt of each progress payment. Final payment shall not be due until Contractor provides unconditional lien waivers from all subcontractors and suppliers."

Walk-Through Clause

"Prior to final payment, Owner and Contractor shall conduct a final walk-through inspection. Owner shall provide Contractor with a written punch list of items requiring correction. Contractor shall complete punch list items within 14 days. Final payment is due upon completion of punch list items."

When to Have an Attorney Review

Consider legal review for:

• Projects over $50,000
• Contracts that seem one-sided
• Custom or unusual provisions
• Projects involving loans or financing
• Commercial properties
• Any contract you don't fully understand

$200-500 for contract review is cheap insurance on a $100,000 project.

The Bottom Line

A thorough contract protects both parties and prevents disputes. Never accept "we'll work it out" or "trust me" as substitutes for clear written terms.

Before signing any contract:

1. Read every word
2. Verify the contractor's license
3. Ensure all blanks are filled in
4. Keep copies of everything
5. Don't be pressured into signing immediately

If a contractor is unwilling to put their promises in writing, that tells you everything you need to know.

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Find licensed, verified contractors in our Washington Contractor Directory. Every listed contractor's registration is confirmed through L&I.