Construction Contract Template (Page 2 of 7) in pdf

Article 4. Change Orders.

Any increase or decrease in the Contract Price, change in the Work or change in the

Contract Time must be set forth in a change order signed by Owner and Contractor and approved

by the Lender (“Change Order”).

Article 5. Payment Procedures

5.l.

Progress Payments. Contractor shall submit to Owner a request for payment in a

form agreed to by Owner and Contractor and approved by Lender (“Request for Advance”)

which shall cover a period of at least_______________ calendar days.

Within ______________________ calendar days after a Request for Advance is

presented, Owner shall notify Contractor if Owner has any concerns about the Request for

Advance that Owner believes should be resolved before Owner pays the amounts specified in the

Request for Advance, and, in this event, Owner and Contractor shall promptly meet to address

such concerns. Owner shall pay Contractor ____ percent (__%) of the full amount covered by

the Request for Advance within _________ calendar days from the day it was presented while

retaining ______ percent (__%) thereof (“Holdback”) to be paid simultaneously with the final

payment. Payment may be withheld for: (1) failure to perform the Work in accordance with the

Contract Documents; (2) defective Work that is not corrected; or (3) failure of the Contractor to

pay subcontractors or to pay for labor, materials or equipment when due.

5.2

Final Payment. Final payment of the balance of the Contract Price including the

Holdback shall be made in accordance with the following procedures:

When Contractor considers the Work substantially complete, Contractor

shall notify Owner in writing. Within a reasonable time thereafter, Owner and Contractor shall

inspect the Work. Promptly after such inspection, Owner shall deliver to Contractor a written

punch list of the items that must be completed in order for the Work to reach final completion

(“Final Completion”). Alternatively, Owner shall deliver to Contractor a written statement that

Final Completion has been reached because no punch list items remain to be completed.

If Owner delivers a written punch list to Contractor, then Contractor shall

deliver to Owner a written notice that the Work is finally complete when Contractor believes that

the punch list items have been completed. Then Owner and Contractor shall promptly inspect the

punch list items. Promptly after such inspection, Owner shall deliver to Contractor either (i) a

written statement that Final Completion has been reached or (ii) another written punch list of the

items that still must be completed in order for the Work to reach Final Completion in which

event the punch list procedure described above shall be repeated until all punch list items have

been completed.

MULTISTATE CONSTRUCTION CONTRACT – Single Family – Fannie Mae HOMESTYLE MODEL DOCUMENT

Form 3734

11/01

(page 2 of 7 pages)

Construction Contract Template Page 2