Change orders and payment schedules on a home remodel

Under Pennsylvania’s Home Improvement Consumer Protection Act, a contractor may not depart from the plans or specifications in any material way without a written change order that you and the contractor both sign and date, with the price change for each departure. On a contract over $5,000, the deposit is capped at one-third of the price, plus the cost of any special-order materials the contract designates. The law leaves the rest of the payment schedule to you and the contractor, and the Attorney General’s office suggests paying in steps as the work progresses, with the final payment at completion.

What the law says about changes

The contract itself has to include a description of the work, the materials and a set of specifications that cannot be changed without a written change order signed by the owner and the contractor. The act’s list of prohibited practices also bars a contractor from deviating from or disregarding the plans or specifications in any material respect without a written change order, dated and signed by both, that contains the price change for each deviation.

Time-and-materials contracts, where you pay actual labor at an hourly rate and actual materials plus a fee, have a cap built in. The contract must state the contractor’s written initial estimate in dollars and say that the cost may not exceed that estimate by more than 10%. Any cost beyond the estimate plus 10% needs a written change order signed by both of you. The Attorney General’s office says these terms were added by an amendment signed on October 22, 2014.

A change can also need the municipality’s approval. Plymouth Township’s residential code package says changes to approved plans must be submitted for approval before the changed work is done. If a change moves a wall, adds a fixture or alters the structure, ask the contractor whether the permit has to be revised.

What to put in a change order

The act sets the minimum: written, dated, signed by both of you, and stating the price change for each deviation. A change order is easier to rely on later when it also states:

• What changes, in the same terms the original specifications use.
• The new contract total, so the running price stays clear.
• Any change to the completion date.
• Whether the change needs a revised permit or an extra inspection.

Keep every signed change order with the contract. Do not approve a change by text or phone call and leave the paperwork for later.

What happens when terms change without consent

The Attorney General’s office described one case in an August 14, 2026 announcement of a lawsuit against a Lackawanna County paving contractor. According to the complaint, a senior citizen in Dauphin County was quoted $16,000 to pave a driveway and paid an $8,000 down payment. After the work, the contractor tried to collect twice the contract amount, and the homeowner learned that terms had been added to the contract without his knowledge or consent. The office says he paid $32,000 because he feared a lien on his property. These are allegations in a complaint filed in the Lackawanna County Court of Common Pleas, and the announcement says the complaint is pending court approval.

Deposits

On money paid up front, the act says:

• No contractor may demand or accept any payment before the contract is signed.
• On a contract over $5,000, the deposit may not exceed one-third of the contract price, or one-third plus the cost of special-order materials designated in the contract.
• The contract must list the down payment and the cost of special-order materials separately.

The act defines special-order materials as items ordered from the factory or distributor for your job that the contractor cannot return for a refund or credit. The Attorney General’s office says a down payment of one-third, or one-third plus special-order materials, is generally appropriate.

Payment schedule

The Attorney General’s office says the law does not address how the balance should be paid, and suggests that the homeowner and contractor negotiate payments in steps as the work progresses, with a final payment on completion.

One way to set the steps is to tie them to inspections, since an inspector’s sign-off is a record you do not have to judge yourself. Under 34 Pa. Code § 403.64, the code official inspects permitted work at set stages, including foundation, plumbing, mechanical and electrical, framing and wallboard, and a final inspection. The table shows how a schedule could follow those stages. It is an example with round numbers, not a legal standard or a recommendation for any project.

Lien waivers with each payment

Under Pennsylvania’s Mechanics’ Lien Law, a contractor or subcontractor who is not paid can file a claim against the property. For residential property, the law lets a contractor or subcontractor give up that right in a written instrument it signs. You can ask for a signed waiver covering the work paid for each time you make a payment, from the contractor and from the major subcontractors and suppliers. Have a lawyer review the waiver form before you rely on it. The mechanics’ liens guide covers who can file, the deadlines and the protection the law gives an owner who has paid in full.

When payments and work fall out of step

If more than 45 days have passed since the start date in the contract and no substantial part of the work has been done, the act lets you request a refund in writing by certified mail, and the contractor must return the money within ten days. A contractor who abandons a job without justification violates the act, and the act counts your failure to pay as required under the contract as justification. Keep your payments matched to the work, and keep receipts.

For a dispute over a payment or a change order, contact the Attorney General’s Bureau of Consumer Protection or a lawyer. The contractor hiring guide has the complaint details.