Do building contracts need notarization?

Typically no; notarization is not required for most construction contracts. Notarization may be required for specific instruments (affidavits, certain lien releases, deeds) depending on state law, so confirm local notary rules before execution.

Can a Building Contract Agreement be signed electronically?

Yes. Electronic signatures are enforceable under the ESIGN Act (15 U.S.C. ch. 96) and UETA where adopted, provided intent, consent, attribution, and retention are met. Exceptions apply for certain documents noted by statute.

How should change orders be handled?

Require written, signed change orders that reference the original contract, describe scope changes, and specify time and price impacts to ensure clarity and to support payment and schedule adjustments.

What steps reduce lien risk?

Obtain contractor and subcontractor lien waivers tied to payment, verify insurance and payment bonds, and record required notices promptly to preserve defenses against mechanics liens.

How long should project records be kept?

Retain executed contracts and related financial records for at least 3 years after completion for IRS purposes (IRC §6501(a)); retain longer where state law or industry rule requires it.

How do you terminate or revoke an agreement?

Follow termination clauses in the contract specifying notice periods, cure opportunities, and final payment obligations. Unilateral revocation without contract basis risks breach claims.

Electronic Signature
Templates
Real estate
Building Contract Agreement

Building Contract Agreement

This template is fully customizable. Edit the text, fill out the fields, and send it for signature. Give it a try!

BUILDING CONTRACT AGREEMENT

This Building Contract Agreement (the "Agreement") is entered into on between the parties identified below.

Parties

Owner Contractor

Property Identification

Property Address Parcel / APN Legal Description

Scope of Work

Contractor shall perform and complete the construction, labor, materials and services described below in a good and workmanlike manner in accordance with plans, specifications and permits. The detailed scope is set forth as follows and is incorporated into this Agreement:

Contract Price and Payment

The Owner shall pay Contractor the total sum of (Contract Price), subject to additions and deductions for approved Change Orders.

Initial Deposit / Mobilization Payment Schedule / Progress Payments Retainage Final Payment / Release Conditions

Schedule and Completion

Work shall commence by and achieve substantial completion by , subject to approved Change Orders and excusable delays.

Liquidated Damages

Permits, Approvals and Inspections

Responsibility for obtaining permits and arranging inspections:

Contractor to obtain all permits required for performance of the Work.

Owner to obtain specified permits identified in writing prior to commencement.

Insurance, Bonds and Performance Security

Contractor shall maintain insurance covering workers' compensation, general liability, automobile liability and such other coverage as is customary for the Work. Contractor shall furnish certificates and, if required, a performance bond in the amount of

Performance bond required

Change Orders

All changes to the Scope of Work, Contract Price, or Schedule shall be made only by written Change Order signed by Owner and Contractor. No oral instructions shall be binding. Change Orders shall set forth the adjustment to the Contract Price and the Schedule.

Subcontractors and Lien Waivers

Contractor may engage subcontractors but remains fully responsible for performance. Contractor shall provide lien waivers for Contractor and subcontractors upon progress and final payments.

Lien waivers required upon payment

Disclosures — Hazardous Materials

Owner represents to the best of Owner's knowledge the condition of the property with respect to the following. Contractor shall verify and notify Owner if hazardous conditions are discovered.

Lead-based paint present? Yes No

Known mold or water intrusion? Yes No

Asbestos or regulated materials present? Yes No

Warranties and Correction of Work

Contractor warrants that materials and workmanship provided under this Agreement will be free from defects for a period of from the date of substantial completion. Contractor shall promptly correct defective work at Contractor's expense.

Delay, Excusable Events and Force Majeure

Either party shall be entitled to an extension of time for delays caused by events beyond its reasonable control, including but not limited to acts of God, utility outages, strikes, shortages of materials, pandemics, or governmental orders. Contractor must notify Owner in writing within a reasonable time of any excusable delay.

Default, Termination and Remedies

Material breach by either party that remains uncured for a period of ten (10) days after written notice shall constitute default. The non‑defaulting party may pursue available remedies at law or in equity, including termination, damages, and completion by others. Owner may withhold payments for defective or incomplete work.

Indemnity and Liability

Contractor shall indemnify, defend and hold Owner harmless from claims, damages, losses and expenses arising out of Contractor's performance, except to the extent caused by Owner's gross negligence or willful misconduct. Limitation of liability shall not apply to willful misconduct or statutory obligations.

Mechanics' Liens and Releases

Contractor shall keep the Property free from all mechanics' and materialmen's liens. Contractor shall promptly discharge any lien arising from Contractor's acts by bond or payment and shall indemnify Owner against lien claims.

Dispute Resolution and Governing Law

The parties agree to negotiate in good faith. If unresolved, disputes shall be subject to binding arbitration conducted under the rules selected by the parties and the award may be entered in any court of competent jurisdiction. This Agreement shall be governed by the laws of the state of .

Entire Agreement

This Agreement, including attached plans, specifications and Change Orders, constitutes the entire agreement between the parties and supersedes prior negotiations and representations. No amendment shall be effective unless in writing and signed by both parties.

Notices

All notices required or permitted shall be in writing and delivered to the addresses set forth in this Agreement by personal delivery, certified mail (return receipt requested), or overnight courier and shall be effective upon receipt.

Owner Printed Name:

By:

Date:

Contractor Printed Name:

By:

Date:

What a Building Contract Agreement Is and why it matters

A Building Contract Agreement is a written contract between an owner (or developer) and a contractor that defines the scope of construction work, the contract price, payment terms, schedule, and responsibilities for permits, insurance, warranties, and change orders. It allocates risk through clauses on delays, liquidated damages, dispute resolution, and indemnities. Properly drafted contracts also address lien waivers, subcontractor obligations, and acceptance criteria for deliverables. Courts enforce these agreements under standard contract law, so clear, complete terms reduce ambiguity, claims, and project delays.

Why a clear Building Contract Agreement protects projects

A precise agreement reduces disputes by documenting scope, timing, and payment expectations while allocating risk and defining remedies for breach.

Who typically completes a Building Contract Agreement

The agreement is completed by parties who will manage, perform, or finance construction work; multiple stakeholders often need copies.

General contractors and construction firms responsible for delivering the work and managing subcontractors on site.
Project owners, developers, and property managers who define scope, approve change orders, and release payments.
Subcontractors, suppliers, and lenders who need contract terms for payment, liens, and performance obligations.

Use the agreement as a central record for each signatory and for anyone responsible for project administration or payments.

Essential sections to include in a professional Building Contract Agreement

A complete agreement bundles obligations, timelines, payment mechanics, and protections into enforceable sections that limit ambiguity and facilitate administration.

Scope of Work

Detailed description of tasks, materials, plans, and finished condition; attach drawings and specifications as exhibits to avoid later disputes.

Contract Price

Firm sum, unit pricing, or cost-plus terms with clear allowances for contingencies, retainage, and conditions that trigger price adjustments.

Schedule & Milestones

Start and completion dates, milestone deliverables, and liquidated damages or incentive language tied to specific, measurable events.

Change Orders

Procedure for written change orders, authority limits, time-and-cost adjustments, and documentation required to validate scope changes.

Warranties & Guarantees

Warranty durations, remedies for defective work, and obligations to correct defects after substantial completion.

Insurance & Bonds

Types and limits of required insurance, certificate requirements, performance and payment bond obligations, and naming of additional insureds.

Step-by-step: preparing and executing a Building Contract Agreement

Follow these sequential steps to create, review, sign, and record a binding agreement with a clear audit trail.

01

Draft the agreement: Assemble scope, specs, schedule, and pricing into a single document with exhibits.
02

Review for compliance: Confirm permitting, insurance, bonding, and local licensing requirements are addressed.
03

Authorize signatures: Obtain sign-off from authorized representatives and record signer titles and dates.
04

Distribute final copies: Provide executed copies to owner, contractor, key subcontractors, and the project file.

How to configure a digital signing workflow for the agreement

Design an online workflow that enforces signer order, authentication, reminders, and document retention settings.

Field	Configuration
Signer Order	Owner first, contractor second, then subcontractors (if required)
Authentication	Email link plus optional SMS code or ID check
Conditional Fields	Show change-order sections only when 'Change Order' is checked
Auto-Reminders	Enable reminders at 3-day intervals until signed

Digital signing and file format considerations

Choose a platform that supports common integrations, secure storage, and industry-standard file types when e-signing contracts.

Integrations: Connectors for Procore, Salesforce, NetSuite, and Google Workspace streamline document routing and record linkage.
File formats: Accept PDFs and DOCX; produce tamper-evident signed PDFs compatible with ISO 32000 standards.
Authentication: Support email, SMS code, KBA, or advanced signer authentication for sensitive projects.

Where to send, store, and file the executed agreement

After execution, route signed copies to participants and retain a central project file with indexed documents for compliance and audits.

Owner copy: Owner retains original executed agreement for project oversight and payment records.
Contractor copy: Contractor keeps an executed copy for jobsite reference and subcontractor coordination.
Project file: Store contracts, exhibits, permits, and change orders together in a project folder.
Local filing: Record lien waivers or notices with county recorder when applicable to protect title.

Comparing eSignature providers for signing Building Contract Agreements

Basic vendor differences that affect contract execution: monthly pricing, bulk send, audit trails, HIPAA support, and envelope/document caps — signNow is listed first for comparison.

	signNow	DocuSign	Adobe Sign	PandaDoc	HelloSign
Starting Price	$8/user/mo	$15/user/mo	$14/user/mo	$19/user/mo	$15/user/mo
Free Trial	7-day free trial	Varies by vendor	Varies by vendor	Varies by vendor	Varies by vendor
Bulk Send	Yes	Yes	Yes	Yes	No
Audit Trail	Yes	Yes	Yes	Yes	Yes
HIPAA Compliant	Yes	Yes	Yes	No	No

Practical tips for accurate and efficient contract completion

Apply these best practices to reduce rework, speed approvals, and maintain a defensible record of signed agreements.

Use numbered exhibits

Attach and reference plans, specifications, schedules, and pricing exhibits by number to avoid ambiguity and to make revisions auditable.

Spell out payment mechanics

Define invoicing requirements, retainage release triggers, and acceptable documentation for change-order cost adjustments to prevent payment disputes.

Preserve the audit trail

Capture signer identity, timestamps, IP addresses, and document history; this supports enforceability and dispute resolution.

Limit oral changes

Require written, signed change orders for any scope, schedule, or price change; clarify who can authorize minor field changes.

Common mistakes to avoid when preparing a Building Contract Agreement

Vague scope descriptions that leave key tasks or finishes undefined and invite disagreement.
Unclear responsibility for permits, inspections, or utility connections leading to cost and schedule disputes.
Missing or incomplete change order procedures that delay approval and payment for legitimate work.
Failure to document lien waivers, subcontractor obligations, and insurance certificates before releasing payments.

Primary risks and potential consequences of incomplete or incorrect contracts

Payment Disputes: Late or withheld payments; stop-work claims

Mechanic's Lien Exposure: Lien filings, encumbrance on property title

Regulatory Noncompliance: Fines, work stoppage, permit revocation

Delay Penalties: Liquidated damages or accelerated costs

Warranty Claims: Costly remediation and extended liability

Tax Reporting Issues: Backup withholding or reporting penalties

Real-world examples of signed building agreements in practice

These brief case examples show how executed agreements improve project clarity and speed administration.

Tim Martin — Martin Properties

A small residential developer used online signatures to complete renovation contracts remotely and reduce turnaround time.

The team processed approvals while on site and off site.
As a result they maintained compliance and obtained signed change orders within 48 hours, avoiding work stoppage and preserving cash flow.

Brian Fitzgibbons — Optica Ventures LLC

A regional GC standardized contract templates and digital workflows for subcontractor agreements.

Templates reduced review time.
Standardization lowered disputes and accelerated payments, enabling better scheduling and lower administrative overhead.

Frequently asked questions about Building Contract Agreements

Answers to common questions about enforceability, e-signatures, notarization, change orders, lien exposure, and contract termination.

Need help? Contact support

Do building contracts need notarization?
Typically no; notarization is not required for most construction contracts. Notarization may be required for specific instruments (affidavits, certain lien releases, deeds) depending on state law, so confirm local notary rules before execution.
Can a Building Contract Agreement be signed electronically?
Yes. Electronic signatures are enforceable under the ESIGN Act (15 U.S.C. ch. 96) and UETA where adopted, provided intent, consent, attribution, and retention are met. Exceptions apply for certain documents noted by statute.
How should change orders be handled?
Require written, signed change orders that reference the original contract, describe scope changes, and specify time and price impacts to ensure clarity and to support payment and schedule adjustments.
What steps reduce lien risk?
Obtain contractor and subcontractor lien waivers tied to payment, verify insurance and payment bonds, and record required notices promptly to preserve defenses against mechanics liens.
How long should project records be kept?
Retain executed contracts and related financial records for at least 3 years after completion for IRS purposes (IRC §6501(a)); retain longer where state law or industry rule requires it.
How do you terminate or revoke an agreement?
Follow termination clauses in the contract specifying notice periods, cure opportunities, and final payment obligations. Unilateral revocation without contract basis risks breach claims.

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