Change Order FAQs

A change order is a written agreement that modifies the original construction contract. It may add, delete, or change the scope of work, price, or timeline due to unforeseen circumstances, design adjustments, or homeowner needs.

Change orders may be necessary due to:

• Unforeseen site conditions (e.g., hidden damage, structural issues)
• Code compliance upgrades discovered during construction
• Errors or omissions in the original scope of work
• Homeowner-requested changes (if allowed)
• Material substitutions (e.g., unavailable or discontinued products)

In most government-funded programs, homeowners cannot request optional or cosmetic changes that increase the cost. Change orders are typically limited to health, safety, code, or structural issues. If homeowner requests are allowed, they must:

• Be reviewed and approved by the program
• Be paid out-of-pocket (if not eligible under the program)

The process generally includes:

1. Identification of the issue by contractor or inspector.
2. Submission of a written change order request with a revised scope and cost.
3. Review by the program's construction manager or inspector.
4. Approval (or denial) by the program administrator.
5. Homeowner acknowledgment may be required but does not necessarily mean the homeowner controls the decision.

It might. Change orders can add time to the project due to:

• Additional work
• Waiting for new materials or inspections
• Review and approval time

Programs try to minimize delays, but changes in scope usually result in adjusted timelines.

Typically, no—but it depends:

• If the change is program-eligible, it will be covered without affecting your eligibility.
• If the total cost exceeds allowable limits (e.g., max award), the program may scale back scope elsewhere or request additional approvals.
• Homeowner-requested upgrades, if allowed, may require the homeowner to pay the difference.

You will usually receive a written notification or be asked to sign a change order acknowledgment. However, final approval authority rests with the program, not the homeowner.

If the change is required for safety or code compliance, rejection may not be allowed and could jeopardize the project. If the change is optional (e.g., an upgrade), you may decline—but this could lead to delays or incomplete work.

Yes. Many programs set thresholds for:

• Number of change orders
• Total dollar amount or percentage of original contract value (e.g., not to exceed 10-20%)
  Exceeding these limits usually triggers additional review or may not be permitted at all.

If denied:

• The original scope of work continues.
• The issue may be resolved using different materials or methods that fall within the approved scope.
• The contractor or program may adjust the schedule accordingly.

Yes. All change orders are formally documented, signed by the contractor and the program (and sometimes the homeowner), and kept in your project file.

Yes. If certain work is no longer needed or less expensive materials are substituted, a credit change order may be issued to lower the total cost.

Change orders are a normal part of construction, especially in rehabilitation or reconstruction of older homes. The key is clear communication and adherence to the program’s rules to avoid delays or funding issues.