What is a change order?
Answered by Netanel Presman, General Contractor (CSLB #1105249) · Updated
Short answer
A change order is a written amendment to a construction contract that adds, removes, or modifies scope, price, or timeline. Change orders must be in writing, signed by both homeowner and contractor, and describe the change specifically before the work is performed. Verbal change orders are a leading cause of disputes. Most states require signed change orders for any scope change beyond the original contract.
In detail
Change orders exist because no remodel ever goes exactly as planned. Walls come open and reveal termite damage. You decide you want the shower 6 inches larger. The inspector finds outdated wiring. Each of these triggers a change to scope, cost, and usually timeline.
What a change order must contain:
- Description of the change — specific, measurable. "Add a niche" is vague; "Add one 12-by-24 inch tiled niche in shower wall centered 48 inches above tub deck with Schluter waterproofing" is a change order.
- Cost impact — itemized (labor, materials, subcontractor cost, markup).
- Timeline impact — days added to the schedule.
- Signatures — both homeowner and contractor, dated before the work begins.
- Updated contract total — new running total after this change.
Why verbal change orders are the #1 dispute cause:
- Contractor remembers $3,500 price; homeowner remembers $2,200.
- Contractor remembers "we'll add 2 weeks"; homeowner remembers no timeline impact.
- Contractor remembers "you approved that last Tuesday"; homeowner remembers discussing but not approving.
State requirements:
- California — CSLB-licensed contractors must document changes exceeding 1% of contract value in writing per Bus & Prof Code §7159.
- New York — Home Improvement Contract Law requires written change orders for work over $500.
- Florida — Chapter 489 requires material changes in writing.
Good practice (protects both parties):
- Have a standard change order form in the original contract.
- Require signed approval BEFORE work starts on the change.
- Keep a running log of change orders and updated totals.
- Photo-document conditions that led to the change.
- Pay for change orders with the rest of the draw schedule, not cash.
Common change order triggers:
- Field conditions revealed at demolition (termite, water damage, outdated wiring).
- Homeowner selections: upgrade to quartzite counter mid-project.
- Inspector-required corrections.
- Owner-caused delays.
- Design revisions from architect.
Warning sign: if a contractor verbally says "don't worry about the paperwork, we'll figure it out at the end" — that's when disputes start. Insist on written change orders from day one.
AskBaily's contract template requires written change orders with itemized cost breakdown and updated running totals.
Sources
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