Read this before signing a contract with your contractor

Read this before signing a contract with your contractor

– and save yourself from a potentially costly lesson.

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Hiring a professional to renovate your home can be a fantastic opportunity — but it also comes with personal risk and requires a great deal of trust in the construction industry. At PayProff, we want to help ensure that both you and your contractor have a smooth and secure experience.

Whether you’re working with a large contracting company or an independent craftsman — for the first or the twenty-fifth time — the process is largely the same. A successful project starts with thorough preparation. Together with your contractor, you define a plan and make an agreement outlining what is to be done, when, and how. This is your chance to reduce the risk of misunderstandings and unforeseen costs. It’s also an opportunity to gain expert advice and ensure the contract addresses all the critical aspects of your project — including how and when payment should be made.

Managing a construction project is complex and time-consuming, especially if you’re juggling a full-time job and family responsibilities. There are countless details and moving parts in any project, even if a general contractor is in charge. Keep in mind: they may not have the same personal stake in the outcome as you do as the homeowner. Your new addition must comply with all applicable laws and building regulations. With so much at stake, it’s crucial to get a written agreement with your contractor or enterprise before starting the work — this helps avoid serious disagreements down the line.

The middle of a home renovation — often a stressful and energy-draining time — is not when you want to worry about whether the work will be completed or what will happen to the 30% of the contract price typically paid up front.

Take, for example, a case reported by Danish newspaper Ekstra Bladet in August 2021. A couple had contracted a renovation of their apartment, including a new kitchen, bathroom, electrical work, flooring, and ceilings — a total project cost of DKK 522,000.

Unfortunately, during the process, the company declared bankruptcy. Even though they had a signed contract and had paid 50% of the total amount up front, not even the BygGaranti scheme could help. They had done everything right — carefully planning and following all the advice — yet there was no safety net in place.

Bo and Lotte couldn’t have foreseen that the company would go bankrupt. They assumed, as private consumers, that some form of protection would be there — but it wasn’t.

How could PayProff have helped in a situation like this?

After selecting a contractor, you create a detailed plan and agreement — including a payment schedule. That’s where PayProff comes in. By incorporating the payment agreement into PayProff, you ensure that you don’t pay until the work agreed upon in the contract is delivered.

Here’s how it works in practice:

1. Receive a quote from your contractor or construction company.

2. Inform the company that you want to use PayProff as a secure payment solution to ensure the task is completed as agreed. This also gives your contractor the confidence that you have the funds to pay.

3. Deposit the agreed amount into your PayProff account.

4. The contractor begins work according to the plan.

5. Based on your contract, funds are released once the work is delivered in the agreed quality and scope.

We protect you from fraud and from unpleasant situations where you’ve paid for a service or product that is never delivered — or delivered at a lower quality than agreed. In many of these cases, it’s almost impossible to recover your money — but with PayProff, you can secure a positive experience and the fulfillment of agreements between you and your contractor.

There have been many initiatives to improve security in the construction process — platforms like haandvaerker.dk have worked toward this since 2009. Still, some consumers end up in distressing and expensive situations that could have been avoided. That’s something knowledge hubs like Bolius.dk actively seek to prevent. Bolius believes that knowledge can help stop stories like Bo and Lotte’s. Cases like these erode public trust in the construction industry and make it harder for honest contractors to do their jobs.

The reality is that many consumers lack peace of mind during the construction process. PayProff wants to help restore that trust.

PayProff is designed to protect you from fraud when paying for a project before the work has been completed. We offer a safe solution for both private individuals and contractors. By adding your payment terms to PayProff and starting the project, both buyer and contractor can rest easy. Your funds are protected in case the agreement is not upheld, and your contractor knows you have the money and will pay once the job is done.

When the work is complete, you — the buyer — simply click “release funds” in your PayProff account. PayProff was built to provide both parties — you and your contractor — a solution that enhances security and trust in the building process.