What a repair quote must include

A good estimate protects you before the work starts. If it says everything that will be done, with what materials, in how long and for how much, you can compare offers and push back if something goes wrong. This guide is for you if you’re repairing your home and have one or more estimates in hand. It explains what an estimate and a contract should say according to official sources, how to pay safely and where to look up a contractor’s license in your state.

Things a written estimate should state, according to the FTC

4¹

To cancel certain sales made at your home

3 business days⁵

The most FEMA recommends paying up front after a disaster

Half⁴

The maximum deposit in California, whichever is less

10% or $1,000³

What an estimate should say

The Federal Trade Commission (FTC) recommends getting multiple estimates. A written one should include four things: a description of the work, the materials, the completion date and the price. Don’t automatically choose the lowest, and ask for an explanation if there’s a big difference among them.¹

To really compare, ask that all the estimates be for the same work. If one proposes repairing part and another replacing everything, you can’t compare them on price. For heating and cooling equipment, ENERGY STAR recommends written, itemized estimates, comparing cost, efficiency and warranties.²

California’s Contractors State License Board (CSLB) gives a good example of how specific to be about materials: quality, quantity, color, size or brand. “Install cabinets” isn’t enough; say which cabinets, from which manufacturer and which model.³

Check each estimate

1. 1. The work

   First

   What will be done, part by part.¹

2. 2. The materials

   With brand and model

   Quality, quantity, color, size or brand, as the CSLB advises.³

3. 3. The completion date

   In writing

   A date, not "whenever we can."¹

4. 4. The price

   Total and by item

   Itemized, so you can compare.²

5. 5. License and insurance

   Before signing

   Look up the license on your state's page and ask for proof of insurance.¹

What the contract should say

The FTC says contract requirements vary by state, but that even if your state doesn’t require a written agreement, you should ask for one. Before signing, make sure it includes:¹

• The contractor’s name, address, phone number and license number.
• An estimated start date and completion date.
• Any promises made in conversations or calls, about the scope of work and the cost of labor and materials.
• A written statement of your right to cancel within three business days, if you signed at home or somewhere other than the seller’s permanent place of business.

And make sure all blank spaces are filled in.¹ The CSLB adds that the contract should say who gets the building permitsbuilding permitA building permit is the approval a local government gives to start a construction project. Not every area of the country requires one. If you renovate with an FHA 203(k) loan, the program requires all building permits to be obtained before work starts and posted on site. Freddie Mac also recommends working with your contractor to get any permits you need before a renovation begins.See the full definitionClose and when each payment is made, and that you should never sign a blank or partially blank contract.³ For heating and cooling equipment, ENERGY STAR recommends that the signed proposal also state the model numbers and the warranty.²

A complete estimate or one that falls short

You can compare

Complete

• States the work, materials, date and price.¹
• Has the contractor's license and details.¹
• Puts promises and guarantees in writing.¹⁴

Ask them to fix it

Something is missing

• It has blank spaces.¹
• It asks for all the money up front.¹
• It only says "roof repair," with no materials or date.¹

If you were promised something out loud, ask for it in writing.¹

How to pay without losing your money

The FTC says not to pay the full amount up front. Some states limit how much a contractor can ask as a down payment: your state or local consumer agency can tell you the law in your area. And never make the final payment until the work is done and you’re satisfied.¹

In California, the CSLB says the down payment should never exceed 10 percent of the price or $1,000, whichever is less, and that the contract should include the total price, when payments are made and whether there’s a cancellation penalty.³ After a disaster, FEMA recommends not paying more than half the cost of repairs in advance.⁴

Example with real numbers

A payment schedule in words

An example of how payments line up; the allowed deposit changes by state.

At signing

A deposit within your state's limit (in California, 10% or $1,000, whichever is less)

During the job

Payments for work already done, with receipts

If there are changes

A signed change order, with the new price

Final payment

When the work is done and you're satisfied

California's limit is from the CSLB;³ the final payment, from the FTC.¹ Plan the cost in your family budget.

Run it with your numbersFamily budget

If the estimate is in English only

Many contractors speak Spanish but write the estimate and the contract in English. The FTC says not to sign a document you haven’t read, that’s in a language you don’t understand or that has blank spaces. If you talk with the salesperson or contractor in a language other than English, depending on where you live and what you’re buying, you may be entitled to a copy of the contract in that language, so you can read and understand it before signing the English version. And don’t let anyone pressure you into signing.¹

If there’s no copy in your language, ask for time. Take the estimate to someone you trust who reads English, or compare it point by point with this guide’s list: the work, materials, date, price, the contractor’s details and license, spoken promises and your right to cancel. Ask about anything you don’t understand before you sign, not after.

What to keep when the job is done

Keep the estimate, the signed contract, every change order, the receipts for all payments, the warranties and the permits together. If something fails, those papers show what was promised and what you paid. If there’s a problem, the FTC recommends following each phone call with a letter sent by certified mail and keeping notes and copies.¹ The contractor scams guide explains where to complain if it isn’t resolved.

Changes halfway through the job

Almost every job changes a little: hidden damage turns up, a material changes or a date moves. The CSLB says that if you add or remove work, swap materials or change the completion date, write it on a change order with the price change; once signed, it becomes part of the contract.³ If the contractor says “we’ll take care of that later” without writing it down, ask them to write it.

Your right to cancel

The FTC’s Cooling-Off RuleFTC Cooling-Off RuleThe Cooling-Off Rule is a federal FTC rule that gives you the right to cancel certain sales a seller makes to you in person away from its place of business, for example in your home, even if you invited the seller. You can cancel before midnight of the third business day after the purchase. The seller must give you a contract in the same language used in the sales pitch, such as Spanish, with two copies of a cancellation notice, and tell you out loud that you can cancel. It does not cover, among others, sales of real estate or insurance, or purchases below a certain price.See the full definitionClose gives you three days to cancel certain sales made at your home. Your right to cancel for a full refund lasts until midnight of the third business day after the sale. The seller must give you two copies of a cancellation form and a dated copy of the contract or receipt with the seller’s name and address and an explanation of your right to cancel.⁵

The Rule has exceptions: it doesn’t cover sales under $25 at your home, sales needed to meet an emergency, or repairs you asked the seller to come do; things you buy beyond that repair are covered.⁵ Some states give their own rights. In California, for example, the CSLB says you may cancel within three days of signing a contract, in writing, mailed before midnight of the third day.³

Where to look up a license in your state

The FTC recommends confirming a contractor’s license with your state or county government.¹ These are official pages we read for this guide, with what each one says:

Place	Who issues the license	What its page says
California	Contractors State License Board (CSLB)	Search by license number, business name or salesperson name, with public complaints.6
Florida	Department of Business and Professional Regulation (DBPR)	A search to verify a licensee and an unlicensed activity search.7
Texas	Department of Licensing and Regulation (TDLR) and State Board of Plumbing Examiners (TSBPE)	TDLR covers air conditioning contractors and electricians; TSBPE regulates plumbing.89
Nevada	State Contractors Board (NSCB)	Search by license number, company or person.10
New Mexico	Construction Industries Division (RLD)	Requires a license for anyone offering construction work.11
New York City	Department of Consumer and Worker Protection (DCWP)	Requires a Home Improvement Contractor license.12
New Jersey	Division of Consumer Affairs	Home improvement contractors are looked up as businesses.13
Denver, Colorado	Community Planning and Development	Issues licenses in the city and doesn’t accept other counties’ or states’.14

If your state isn’t on the list, find the board or agency that licenses contractors on your state government’s official site, and ask your county or city: in some places the city issues the license, as in New York and Denver.¹²¹⁴ Rules also change by trade: in Texas, for example, air conditioning and electrical work are under TDLR and plumbing under TSBPE.⁸⁹

If this is you

You have three estimates with very different prices

Ask for an explanation of the difference and check that all are for the same work.¹

The contractor explained everything in Spanish

Ask that spoken promises be written down, and for a copy in Spanish if you're entitled to one.¹¹

You need the repair after a disaster

Don't pay more than half up front, and get the guarantees in writing.⁴

You're asked to sign a contract with blank spaces today

Don't sign it: every space must be filled in.¹³

Costly mistakes

• Mistake: Choosing the cheapest estimate without asking why.

  Instead: Ask for an explanation of big differences between estimates.¹

• Mistake: Signing with blank spaces.

  Instead: Check that everything is filled in before you sign.¹

• Mistake: Accepting spoken changes halfway through the job.

  Instead: Ask for a signed change order with the new price.³

• Mistake: Paying everything before the job is done.

  Instead: Don't pay in full up front or make the last payment before you're satisfied.¹

• Mistake: Believing a license number on the estimate is enough.

  Instead: Look it up on your state's or city's official page.¹

What to do this week

1. Get two or three written estimates for the same work.¹
2. Check that each one states the work, materials, completion date and price.¹
3. Look up each contractor’s license on your state’s or city’s official page.¹
4. Before signing, check the contract against this guide’s list and fill every blank space.¹
5. Agree on a payment schedule that follows the work, without paying everything up front.¹
6. Add the cost to your family budget, and read the guides on contractor scams, the roof and heating and cooling.