The Home Improvement Contract Checklist: Down Payment, Change Orders, and Right to Cancel
"The Home Improvement Contract Checklist: Down Payment, Change Orders, and Right to Cancel" is lesson 4 of 8 in the Law & Business Learning Hub. It opens with "When Section 7159 Applies" and works through 5 short steps, then a worked example you can check yourself against.
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Steps in this lesson
When Section 7159 Applies
The Required Headings
The Money Rules
Change Orders and Subcontractor Disclosure
Required Notices and the Right to Cancel
The worked example in the course applies this lesson to a realistic job in 5 steps, from "Maximum downpayment" through "Change order".
What you'll be able to do
Explain the main idea of "The Home Improvement Contract Checklist: Down Payment, Change Orders, and Right to Cancel" in plain language you can use on the exam.
Apply this step with confidence: "The Money Rules".
Apply this step with confidence: "Change Orders and Subcontractor Disclosure".
Apply this step with confidence: "Required Notices and the Right to Cancel".
Test yourself on the worked example and the quick-check quiz inside the classroom.
The diagram for this lesson, exactly as it appears in the Learning Hub.
The first steps of this lesson
Step 1: When Section 7159 Applies
B&P Code 7159(b) defines a home improvement contract as an agreement, oral or written, between a contractor and an owner (or a tenant), for the repair, remodeling, altering, converting, modernizing, or adding to residential property (defined in 7151) when the aggregate contract price, including all labor, services, and materials, exceeds $500. Under 7159(d) the contract and any change to it must be in writing and signed by the parties before work starts. Before any work begins the contractor must give the buyer a copy signed and dated by both sides, and the writing must be legible, with printed text at least 10-point and headings at least 10-point bold (7159(c)).
Step 2: The Required Headings
7159(d) lists what the contract must contain: the contractor's name, address, and license number; the home improvement salesperson's name and registration number if one was involved; the heading "Home Improvement"; the 12-point bold statement that the buyer is entitled to a completely filled-in copy signed by both parties before work starts; "Contract Price" in dollars and cents; "Finance Charge" if any; "Description of the Project and Description of the Significant Materials to be Used and Equipment to be Installed"; "Downpayment" if any; "Schedule of Progress Payments"; "Approximate Start Date"; "Approximate Completion Date"; the list of documents incorporated, if any; and the "Note About Extra Work and Change Orders." Missing information, notices, or disclosures is cause for discipline (7159(a)(5)).
The remaining 3 steps, the worked example and the quiz are in the course. This is a preview. The full lesson, with the step-by-step explanations, a worked example and a quick-check quiz, is inside the classroom.
Independent exam preparation. Contractors Classroom is not affiliated with the Contractors State License Board, and no course can guarantee a passing result.
