Michigan Residential Builders License Practice Test

What must a builder or contractor ensure is included in written agreements according to purchase and sale agreements?

1. Specifications and cost

2. The personal details of the homeowner

3. A list of previous projects

4. Future maintenance plans

The correct answer is: Specifications and cost

A builder or contractor must ensure that specifications and cost are included in written agreements according to purchase and sale agreements. This is essential because these elements outline the details of the project, including the materials to be used, the specific work that will be performed, and the agreed-upon price. This clarity helps to prevent misunderstandings and disputes between the parties involved by establishing a clear scope of work and a financial framework for the project. When specifications and costs are thoroughly detailed, both the builder and the homeowner have mutual expectations regarding what will be delivered and at what cost, ensuring transparency and protection for both parties. Additionally, these specifications often serve as a reference point for inspections and compliance with local building codes, making them critical components of a legally binding agreement.