By Heather Domi & Team | Expert Real Estate Advisors
With insights from Ilyse Dolgenas, Real Estate Attorney

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We’ve seen it time and time again: a well-intentioned homeowner excited to finally renovate the kitchen or add that dream ensuite, only to find themselves caught in a nightmare of cost overruns, timeline delays, or—worst of all—legal disputes that could have been avoided.

The most preventable mistakes in home renovations don’t happen during construction—they happen before the first hammer swings. They happen at the contract stage.

And that’s exactly where a real estate attorney comes in.

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Why You Need a Real Estate Attorney Before Signing with a Contractor or Architect

Renovating your home is not just a construction project—it’s a legal and financial agreement that can significantly impact your property, equity, and peace of mind. Here’s why legal review matters:

• Contracts are written to protect the contractor or architect first—not you. Without legal review, you may be signing away important protections or rights you didn’t even know you had.
  
• You are legally and financially bound by what you sign. One vague clause or missing provision can cost you thousands of dollars—or worse, lead to a lien on your home.
  
• Municipal codes, zoning laws, and building permits are more complex than ever. A real estate attorney understands how to spot potential regulatory or compliance issues before they create delays or denials.
  
• Scope creep is real. If your contract doesn’t clearly define what’s included (and what’s not), you could end up footing the bill for unexpected expenses that were never clearly laid out.
  
• As attorney Ilyse Dolgenas emphasizes, “Schedule and change orders are the major issues that trigger the breakdown of the relationship with the contractor.” These are the points where misunderstandings quickly escalate into disputes—making clear, attorney-reviewed language essential.
  

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Best Practices: Protect Yourself and Your Investment

Before you hire a contractor or architect—or sign anything—follow these best practices:

Have a Real Estate Attorney Review the Contract for:

• Clear scope of work with timelines and payment schedules
  
• Defined process for change orders or unexpected costs (“Schedule and change orders,” notes Dolgenas, “are where relationships most often go wrong.”)
  
• Termination clauses and what happens if things go south
  
• Permitting responsibilities (who’s pulling them—you or the contractor?)
  
• Complying with building rules and regulations—including payment of any fines by the builder
  
• Requirement that all building permits must be properly closed out, and contractor must follow through until the job is officially closed
  
• If a Certificate of Occupancy (C of O) is required, final payment should be withheld until the C of O is received
  
• Include an attorney fee clause: the prevailing party in any legal dispute is entitled to recover legal costs
  
• Identify key personnel: “The contractor and the architect should identify the individual from their staff who will be dedicated to the project for the entire project,” says Dolgenas. Continuity matters.
  
• Retainage: Dolgenas reminds owners, “You are permitted by law to withhold 5% from the contractor’s applications for payment until the project is completed—even the punch list.”
  

Confirm Insurance and Trust Fund Structure:

• Contractor must provide proof of Certificate of Insurance (COI)
  
• All subcontractors must also provide proof of COI
  
• Contractor must carry general liability, builder’s risk, and an overriding policy for defective work
  
• Subcontractors must maintain equivalent coverage
  
• Client must be named as an additional insured on all relevant policies
  
• Owner’s insurance review: Dolgenas advises, “Make sure your insurance agent reviews the contractor’s proposed coverage—many insurers require specific clauses like a waiver of subrogation, which the contractor must acknowledge and accept.”
  
• Proper trust account structure per NYS lien laws: All funds must be held in a designated trust account; no more than 25% of those trust funds should flow through to the contractor’s operating account
  

Watch for Time Limits and Penalties:

• In NYC, the Department of Buildings has a 120-day construction window. After this, some co-ops or condos charge substantial overage fees.
  
  • Ensure the contractor commits in writing to covering any daily overage penalties beyond the 120-day window
    
• Include a clause that the contractor is financially responsible for exceeding the building’s allowed construction timeline
  

Define Timelines for Deliverables:

• Architect must deliver major design revisions within 14 calendar days
  
• Minor modifications must be turned around in 7 business days
  
• A written project timeline should outline major milestones and expected completion date
  
• Dolgenas adds, “Make sure the architect stays involved with the project and commits to weekly walkthroughs and review of the contractor’s payment applications. They are the most knowledgeable consultant and can confirm the work is complete before you make payments.”
  

Keep it All in Writing:

• Avoid relying on verbal promises—if it’s not in writing, it doesn’t count
  
• Communicate changes or concerns by email so there’s a paper trail
  

Involve Your Real Estate Advisor:

• We can help connect you with vetted professionals
  
• We work with attorneys who understand your local laws and zoning
  
• We know how renovations affect your home’s future resale value
  

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Personal Stories from the Field

Heather:
A few years ago, I had a client who was renovating a brownstone in Brooklyn. She signed an agreement with an architect without legal review. Halfway through the project, she found herself paying for “revisions” that should have been included in the original scope. A quick review by an attorney could have prevented months of stress and saved her over $30,000.

Andrew (from our team):
One client had a contractor walk off the job after a payment dispute. The contract didn’t outline a proper termination clause or dispute process. A real estate attorney could’ve added language protecting her right to withhold final payment until completion—and avoided the six-month delay that followed.

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Our Advice as Real Estate Advisors

Renovations are one of the biggest financial investments you’ll make in your home—treat them with the same level of care and professional oversight as a purchase or sale. That means bringing in an expert before it goes sideways.

As real estate advisors, we are here not just to help you buy or sell—but to protect your investment through all of life’s chapters, including renovations.

If you’re thinking of upgrading your home, let us introduce you to our trusted network of attorneys, architects, and contractors. We’ll make sure you’re covered from the first sketch to the final walkthrough.

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Have questions? Want us to review your renovation plans?
We’re here to help. Click here to schedule a Selling Smart Strategy Call to assess your options and talk renovations.