What does a California home improvement contract have to include?
Short answer
California law (Business and Professions Code 7159) requires home improvement contracts to be in writing and to include the name, address and license number of the person doing the work, a detailed description of the work and materials, approximate start and completion dates, a payment schedule tied to work actually completed, a down payment that cannot exceed $1,000 or 10 percent of the contract price, whichever is less, and specific notices including the right to cancel. Read it before you sign, and keep a copy.
Why the law spells this out
Most disputes between homeowners and the people they hire are not about bad work. They are about two people remembering a conversation differently. California's home improvement contract law exists to put that conversation on paper before anyone picks up a saw. It applies to home improvement contracts with licensed contractors above a modest dollar threshold, and the Contractors State License Board publishes the full list of requirements in plain language.
We think of these rules as consumer information worth knowing no matter who you hire. Whether the person doing the work is a large firm or a one-person shop, a contract that covers these points protects both sides.
What must be on the page
The statute is specific about what a home improvement contract has to contain. Read your paperwork against this list.
- The words Home Improvement in the heading, plus the name, business address and license number of the person contracting with you.
- A description of the project and the significant materials and equipment to be used or installed, in enough detail that a stranger could picture it.
- The approximate start date and the approximate completion date.
- The total contract price, with any finance charge stated separately.
- The down payment, which cannot exceed $1,000 or 10 percent of the contract price, whichever is less.
- A schedule of progress payments that describes what work or materials each payment covers.
- A statement that any change in the work must be in a written change order signed by both parties before it is performed.
- The required notices, including the Mechanics Lien Warning, the notice about the CSLB, and your right to cancel.
Payment terms the law controls
Two payment rules do most of the protective work. The first is the down payment cap described above. The second is that progress payments must track work actually done or materials actually delivered to the site. The contract cannot ask you to pay for framing that has not been built or decking that is still at the lumberyard.
A good payment schedule reads like a construction schedule: footings inspected, framing complete, decking and railing installed, final walkthrough. Each line names the work and the amount. If a schedule is vague about what triggers a payment, ask for it to be rewritten before you sign.
Notices and your right to cancel
California gives homeowners a right to cancel a home improvement contract signed at their home within three business days, and longer for buyers who are 65 or older. The contract has to tell you this in a specific notice and include a cancellation form. The Mechanics Lien Warning explains that subcontractors and suppliers who are not paid can place a lien on your property even if you paid the person you hired, and it tells you how to protect yourself with lien releases.
None of this is fine print to skim. These notices are where the law puts your leverage, and knowing they belong in the contract tells you right away whether the person across the table knows the rules.
How we handle it
Our proposals describe the work the way the statute asks: dimensions, species and grade of every visible material, framing and hardware, footings and flashing, finish, schedule and a payment plan tied to milestones. Write-ups like that take longer to prepare, and they save far more time later. If you are comparing proposals and one of them fits on a sticky note, that is information too.
For the official checklist, the CSLB's consumer publications and the text of Business and Professions Code 7159 are the sources to read. They are short, and they are free.
Related questions
Does the contract law apply to small repairs?
Home improvement under California law includes repair, remodeling and alteration, not just new construction, so a rot repair or fence rebuild is covered once the price passes the statute's threshold. Very small jobs may fall below it. Even then, a written description of the work, the materials and the price is worth asking for.
Can a contract be changed once work starts?
Yes, but the change has to be in writing. The law requires a change order describing the extra or different work and its price, signed by both parties, before that work is performed. Verbal changes are the most common source of surprise invoices, and the written requirement protects you from them.
Where can I read the actual law?
Business and Professions Code section 7159 is published on the California Legislature's website at leginfo.legislature.ca.gov, and the CSLB summarizes it in its consumer guides at cslb.ca.gov. Both are linked in the sources below.
Sources and further reading
- California Business and Professions Code section 7159 (leginfo.legislature.ca.gov)
- Contractors State License Board (www.cslb.ca.gov)