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Texas Homeowner-Contractor Agreement

A plain-language contract template built around Texas residential construction law — RCLA compliance, mechanics' lien disclosures, local licensing guidance, and cancellation rights.

Texas Tex. Prop. Code Ch. 27 v1.0 — March 2026

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Instructions — not part of the agreement

How to Use This Template

This template was built by jaspector.com to help Texas homeowners protect themselves when hiring a contractor. It covers the key provisions of Texas residential construction law, including mechanics' lien disclosures, the Residential Construction Liability Act (RCLA), and cancellation rights.

Before You Start

Verify the contractor's credentials. Texas does not require a statewide general contractor license, but certain trades (electrical, plumbing, HVAC) require state licenses through TDLR. Many cities also require local registration. Use tdlr.texas.gov for state trade licenses and contact your local permitting office. See our Texas contractor verification guide for step-by-step help.
Download and print this document. Fill in all blank fields — do not leave any section empty.
Ensure required disclosures are included. Texas law requires the RCLA notice (Section 12.1) in 10-point boldface type and the residential construction disclosure statement (Section 12.2) before signing.
Both parties sign. You and the contractor each get a signed copy before any work starts.
Consult an attorney. This template is a starting point. For large projects or complex scopes, have a Texas-licensed attorney review the agreement.

Field-by-Field Guide

› Section 1 (Parties): Fill in legal names exactly as they appear on official documents. Record the contractor's state trade license numbers (if applicable) and any local registration or license number.
› Section 2 (Scope): Be as specific as possible. "Kitchen remodel" is not enough — list materials, dimensions, finishes, and what is excluded.
› Section 3 (Payment): Texas has no statutory deposit cap, but best practice is to limit down payments to no more than 10% of the contract price or the cost of special-order materials. Tie every payment to a completed milestone, not a calendar date.
› Section 4 (Timeline): Get start and completion dates in writing. Fill in the delay penalties — these protect you if the contractor falls behind.
› Section 7 (Warranties): Fill in the warranty period. One year is common; negotiate for more on major work.
› Section 14 (Exhibits): Attach all plans, specs, the contractor's license/registration documents, insurance certificates, the disclosure statement, and the subcontractor list.
› No statewide GC license: Texas does not license general contractors at the state level. However, electricians, plumbers, HVAC technicians, and other specialty trades must hold state licenses through TDLR. Many cities (Dallas, Austin, San Antonio, and others) require local contractor registration.
› No statutory deposit cap: Unlike California, Texas does not impose a statewide limit on down payments. Protect yourself by negotiating a reasonable deposit tied to actual costs.
› RCLA pre-suit notice: Before suing over a construction defect, you must send the contractor a certified-mail notice at least 60 days in advance (Property Code Chapter 27).
› Mechanics' lien protections: Under Property Code Chapter 53, subcontractors and suppliers can lien your property if unpaid. Require lien waivers with every payment and request a subcontractor list before work begins.
› Three-day cancellation: If you sign this contract anywhere other than the contractor's fixed place of business, you have three business days to cancel (Business & Commerce Code Chapter 601).
› Workers' comp is optional: Texas does not require private employers to carry workers' compensation. Ask about coverage before hiring.

About Jaspector

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Learn more at jaspector.com — or email hi@jaspector.com to get started.

The instructions above are provided by jaspector.com as an educational resource. They are not part of the agreement, do not constitute legal advice, and do not create an attorney-client or endorsement relationship.

Before You Begin: This template helps you understand what a strong Texas contractor agreement looks like. It is an educational starting point provided by jaspector.com — not a finished contract, and not legal advice. Texas law imposes specific requirements on residential construction contracts, and local jurisdictions may add further obligations. Have this document reviewed by a Texas-licensed attorney before use. Use of this template does not create an attorney-client relationship, and jaspector.com assumes no liability for any outcomes arising from its use.

Parties

Homeowner (Property Owner)

Name(s)
Property Address
Mailing Address
Phone
Email

Contractor

Business Name
Business Name (Legal Entity)
State Trade License(s) (if applicable)
Local Contractor Registration/License #
Issuing City/County
Workers' Compensation Policy # (or exempt status)
Qualifying Individual
Business Address
Phone
Email
Workers' Comp Policy #
General Liability Policy #

Texas Note: Texas does not require a statewide general contractor license. However, certain trades (electrical, plumbing, HVAC, fire sprinklers) require state licenses through the Texas Department of Licensing and Regulation (TDLR). Many cities — including Dallas, Austin, San Antonio, and others — require local contractor registration or licensing. Verify state trade licenses at tdlr.texas.gov and check your city's permitting office for local requirements. See our Texas contractor verification guide for step-by-step help.

Scope of Work

2.1 Project Description

Describe the work in specific, measurable detail. Include materials, methods, dimensions, and reference any plans, drawings, or specifications attached as exhibits.

2.2 Work NOT Included

Explicitly list work excluded from this contract to prevent scope disputes.

2.3 Permits and Inspections

Contractor is responsible for obtaining all required building permits
Contractor is responsible for scheduling all required inspections
Permit costs are: Included in contract price / Billed separately at cost

Texas Note: The contractor should pull permits for licensed work. If a contractor asks the homeowner to pull the permit, that is a red flag — it may be an attempt to avoid trade licensing requirements or local code enforcement oversight. Note that permit requirements vary by city and county in Texas.

2.4 Plans and Specifications

Attached as Exhibit A (architectural / engineering plans)
Attached as Exhibit B (material specifications)
No formal plans — scope defined by Section 2.1 above

Contract Price and Payment Schedule

3.1 Total Contract Price

Total Contract Price	$
Sales Tax (if applicable)	$
Permit Fees (if separate)	$
Total Amount Due	$

3.2 Payment Schedule

Texas Note: Texas does not impose a statewide statutory cap on down payments for residential construction contracts. However, best practice is to limit down payments to no more than 10% of the contract price or the cost of materials that must be specially ordered, whichever is greater. Never pay the full contract price upfront. Tie all payments to completed work milestones.

Payment	Amount	Trigger (Work Milestone)
Down Payment	$	Upon signing
Progress Payment 1	$
Progress Payment 2	$
Progress Payment 3	$
Final Payment	$	Completion and final inspection
Total	$

3.3 Payment Terms

›Payments are due within days of written invoice
›Acceptable payment methods:
›No payment shall be due for work not yet performed or materials not yet delivered to the job site
›Final payment is due only after: (a) all work is complete, (b) final inspection is passed (if applicable), and (c) Homeowner has had reasonable opportunity to inspect

Project Timeline

Estimated Start Date
Estimated Completion Date

4.1 Delays

›Contractor shall notify Homeowner in writing within 48 hours of any event that may delay the project
›Excusable delays include: weather, permit delays, material shortages, acts of God, government orders
›Non-excusable delays exceeding business days entitle Homeowner to a daily credit of $
›If the project is not substantially complete within days of the estimated completion date (excluding excusable delays), Homeowner may terminate under Section 9

Change Orders

Any changes to the scope, price, or timeline of this contract must be documented in a written Change Order signed by both parties before the changed work begins.

Each Change Order shall include:

Description of the changed work
Addition to or deduction from the contract price
Impact on the project timeline
Signature of both Homeowner and Contractor

Texas Note: Always require written change orders. Under the Texas DTPA (Business & Commerce Code Chapter 17), a contractor who performs unauthorized work and demands payment may be engaging in a deceptive trade practice. If a contractor performs extra work without a signed change order, document the issue immediately.

No verbal agreements will modify this contract.

Materials and Workmanship

6.1 Materials

›All materials shall be new unless otherwise specified in writing
›Substitutions require prior written approval from Homeowner
›Contractor warrants that all materials comply with applicable building codes

6.2 Workmanship Standards

›All work shall be performed in a professional, workmanlike manner
›All work shall comply with applicable Texas building codes and local ordinances
›All work shall conform to the plans, specifications, and scope described in this contract
›Contractor shall maintain a clean and safe job site

6.3 Subcontractors

›Contractor use subcontractors (will / will not)
›If subcontractors are used, Contractor remains fully responsible for their work, licensing, and insurance

Warranties

7.1 Contractor Warranty

Contractor warrants all labor and workmanship for a period of year(s) from the date of completion. During this period, Contractor shall repair or correct, at Contractor's expense, any defects in workmanship or materials furnished by Contractor.

7.2 Manufacturer Warranties

Contractor shall provide Homeowner with all manufacturer warranties for materials and equipment installed. Contractor shall ensure installations comply with manufacturer specifications to preserve warranty coverage.

7.3 Warranty Exclusions

›Normal wear and tear
›Damage caused by Homeowner negligence or misuse
›Damage caused by third parties or acts of God
›Items specifically excluded in writing

Insurance and Bonding

8.1 Contractor Insurance Requirements

Coverage	Minimum Amount
General Liability	$
Workers' Compensation	Statutory limits (required if Contractor has employees)
Automobile Liability	$

›Contractor shall provide certificates of insurance upon request
›Homeowner shall be named as additional insured on the general liability policy

Texas Note: Texas is the only state that does not require most private employers to carry workers' compensation insurance. Contractors may choose to be "non-subscribers." However, if the contractor has employees and does not carry workers' compensation, injured workers can sue the contractor — and the homeowner could face liability exposure. Best practice: Require workers' compensation coverage or written confirmation of non-subscriber status with adequate alternative coverage.

Termination

9.1 Homeowner's Right to Terminate

›Homeowner may terminate this contract at any time by providing written notice
›Homeowner shall pay for all work satisfactorily completed and materials delivered as of the termination date
›Contractor shall provide an itemized accounting within 10 business days of termination
›Contractor shall not charge a cancellation penalty exceeding actual costs reasonably incurred

9.2 Contractor's Right to Terminate

›Homeowner fails to make a payment within days of written notice of default
›Conditions at the job site make the work unsafe or illegal to continue

Texas Law (Business & Commerce Code Chapter 601): If this contract was signed at the Homeowner's residence or at any location other than the Contractor's fixed place of business, and the total price exceeds $25, the Homeowner has the right to cancel this contract until midnight of the third business day after the date of signing without penalty. Contractor must attach a completed "Notice of Cancellation" form in duplicate at the time of signing. If the Contractor fails to provide this notice, the cancellation period is extended. Upon cancellation, Contractor must return all payments within 10 business days.

10.

Dispute Resolution

10.1 Informal Resolution

The parties agree to attempt informal resolution of any dispute by written notice describing the issue. The other party shall respond in writing within 15 business days.

10.2 Mediation

If informal resolution fails, the parties agree to submit the dispute to non-binding mediation before a mutually agreed mediator. Mediation costs shall be shared equally.

10.3 RCLA Notice Requirement

Texas Law (Property Code Chapter 27): Before filing a lawsuit for a residential construction defect, the Homeowner must send the Contractor written notice by certified mail, return receipt requested, at least 60 days before filing suit. The notice must describe the construction defect in reasonable detail. The Contractor then has 35 days to request an inspection and 60 days to make a written offer of repair or settlement. Failure to comply with these requirements may limit the Homeowner's ability to recover damages.

10.4 Texas Attorney General / DTPA Complaint

Texas Resource: Homeowners may file a complaint with the Texas Attorney General's Consumer Protection Division regarding deceptive trade practices. Under the DTPA (Business & Commerce Code Chapter 17), consumers who are victims of false, misleading, or deceptive acts may recover actual damages, and up to three times damages if the conduct was knowing or intentional. A 60-day demand letter is required before filing a DTPA lawsuit. File at: texasattorneygeneral.gov/consumer-protection.

10.5 Legal Action

If mediation fails, either party may pursue legal action in the county where the property is located. The prevailing party shall be entitled to recover reasonable attorney's fees and costs.

11.

Mechanics' Lien Notice

Texas Law (Property Code Chapter 53): Texas allows contractors, subcontractors, and material suppliers to place a mechanics' lien (called a "mechanic's, contractor's, or materialman's lien") on your property if they are not paid for work or materials. This lien can affect your ability to sell or refinance.

11.1 Protecting Against Mechanics' Liens

›Request lien waivers from the contractor and all subcontractors with each progress payment

›Request a conditional final lien waiver before making the final payment, and an unconditional final lien waiver upon final payment

›Per Texas Property Code §53.256, require Contractor to provide a list of all subcontractors and material suppliers before construction begins

›Monitor payments to subcontractors — under Texas law, even if you pay the contractor, you may be liable if subcontractors and suppliers are not paid

11.2 Lien Filing Deadlines

Under Texas Property Code Chapter 53 (Subchapter K — Residential Construction Projects):

›Subcontractors and suppliers must send notice to the homeowner not later than the 15th day of the second month after the month in which unpaid labor or materials were provided

›A lien claimant on a residential project must file a lien affidavit with the county clerk not later than the 15th day of the third calendar month after the date the indebtedness accrues

›Suit to foreclose a residential mechanics' lien must be filed within one year after the last day to file the lien affidavit or within one year after completion/termination/abandonment of the original contract, whichever is later

12.

ADDITIONAL TEXAS REQUIREMENTS

12.1 RCLA Contract Notice (Property Code §27.007)

Texas law requires that residential construction contracts contain the following notice in 10-point boldface type:

"This contract is subject to Chapter 27 of the Texas Property Code. The provisions of that chapter may affect your right to recover damages arising from a construction defect. If you have a complaint concerning a construction defect and that defect has not been corrected as may be required by law or by contract, you must provide the notice required by Chapter 27 of the Texas Property Code to the contractor by certified mail, return receipt requested, not later than the 60th day before the date you file suit to recover damages in a court of law or initiate arbitration. The notice must refer to Chapter 27 of the Texas Property Code and must describe the construction defect. If requested by the contractor, you must provide the contractor an opportunity to inspect and cure the defect as provided by Section 27.004 of the Texas Property Code."

_Failure to include this notice subjects the contractor to a civil penalty of $500._

12.2 Residential Construction Disclosure Statement (Property Code §53.255)

Before this contract is executed, the Contractor shall deliver to the Homeowner a disclosure statement substantially similar to the one required by Texas Property Code §53.255, which includes the following key provisions:

›Contractor may not require homeowner to convey real property as a condition of the agreement

›Contractor must provide a list of subcontractors and suppliers before construction begins

›Homeowner may be liable for unpaid subcontractors and suppliers even if the contractor was paid

›Homeowner should never sign a document that is not true

›Homeowner should monitor the work and payments throughout the project

12.3 Local Licensing and Registration

Texas does not have a statewide general contractor license. However, many cities and counties require contractor registration, licensing, or bonding. Check with your local permitting office for requirements specific to your jurisdiction. State-regulated trades (electrical, plumbing, HVAC, fire sprinkler systems) require licenses through TDLR regardless of local rules.

13.

General Provisions

›Entire Agreement: This contract, including all exhibits and change orders, constitutes the entire agreement. No prior verbal or written representations shall be binding unless incorporated herein.
›Severability: If any provision is found unenforceable, the remaining provisions continue in full force.
›Governing Law: This contract shall be governed by the laws of the State of Texas.
›Notice: All notices shall be in writing and delivered to the addresses in Section 1, by personal delivery, certified mail, or email with confirmed receipt.
›Assignment: Neither party may assign this contract without prior written consent of the other party.

14.

Exhibits and Attachments

Exhibit A: Plans and Drawings
Exhibit B: Material Specifications
Exhibit C: Notice of Three-Day Right to Cancel (if applicable)
Exhibit D: Residential Construction Disclosure Statement (Property Code §53.255)
Exhibit E: Contractor's Trade License(s) and/or Local Registration
Exhibit F: Certificates of Insurance
Exhibit G: List of Subcontractors and Suppliers
Additional: _________________________________

Signatures

By signing below, both parties acknowledge that they have read, understand, and agree to all terms of this contract.

Homeowner

Signature

Printed Name
Date

Homeowner (if jointly owned)

Signature

Printed Name
Date

Contractor

Signature

Printed Name
Title
Trade License # (if applicable)
Date

Texas Pre-Signing Checklist

Before signing, confirm each item:

Verified contractor's state trade licenses (if applicable) at tdlr.texas.gov
Checked local city/county contractor registration or licensing requirements
Confirmed general liability insurance is current
Confirmed workers' compensation status (coverage or non-subscriber acknowledgment)
RCLA notice (Property Code §27.007) is included in this contract in 10-point boldface
Residential construction disclosure statement (Property Code §53.255) delivered by contractor
List of subcontractors and suppliers provided by contractor
Three-Day Right to Cancel notice provided (if signed away from contractor's business)
All blank fields in this contract are filled in — no blank spaces
Received a signed copy of the complete contract before work starts
Payment schedule tied to work milestones, not calendar dates

Next step

Verify your contractor's Texas credentials

Look up TDLR trade licenses, local registration status, and complaint history before you sign.

Texas License Lookup

Before you sign

Want a second opinion on your contractor agreement?

Jaspector can review your agreement, verify your contractor's license, and flag anything that doesn't look right — before you commit.

See how Jaspector helps

This template was prepared by jaspector.com as an educational resource for Texas homeowners.

It is not legal advice. Consult a Texas-licensed attorney before executing any construction contract.

Template v1.0 — March 2026

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Texas Contractor Agreement FAQ

Do general contractors in Texas need a state license?

Texas does not have a statewide general contractor license. General contractors are primarily regulated at the local level through building permits and city or county registration. However, specific trades — including electricians, plumbers, HVAC technicians, and irrigation contractors — require a state license from the Texas Department of Licensing and Regulation (TDLR). Always verify applicable trade licenses at tdlr.texas.gov and check local registration requirements with your city or county.

What is the Texas Residential Construction Liability Act (RCLA)?

The Texas Residential Construction Liability Act (Texas Property Code Chapter 27) requires homeowners to follow a specific notice-and-repair process before suing a contractor for construction defects. You must send written notice identifying each defect at least 60 days before filing suit. The contractor has the right to inspect and offer to repair or compensate. Skipping this process can limit your legal remedies.

Can subcontractors place a lien on my Texas property?

Yes. Under Texas Property Code Chapter 53, contractors, subcontractors, and material suppliers can file mechanic's and materialman's liens against your property for unpaid work. Texas lien law requires contractors to deliver specific notices on strict timelines. Protect yourself by requiring a list of subcontractors and suppliers before work begins and obtaining signed lien waivers with each payment.

What is a Texas residential construction disclosure statement?

Texas Property Code §53.255 requires residential contractors to provide homeowners with a written disclosure statement before signing a contract. The statement informs you of your rights under Texas lien law, including your right to receive a list of subcontractors and suppliers and to withhold payment if required lien waivers are not provided.

Does Texas law give me a right to cancel a home improvement contract?

Yes. Texas Business & Commerce Code Chapter 601 (the Door-to-Door Sales Act) gives you 3 business days to cancel a contract over $25 that was signed at your home or away from the contractor's regular business location. The contractor must provide a written Notice of Cancellation at the time of signing.