Time and material, pros/cons

[Bob Lett]

Working on a whole house remodel that we are going to use as a second home and STR/AirBnB. With our contract purchase price + contractor quotes we have little to no wiggle room for intangibles based upon ARV. This is a lake house on an all sports lake with strong rentals in the same township and lake. What are the pros/cons of doing time and material with a contractor vs letting contractor purchase items?

[Nathaniel Walker]

Time & materials works best when you can monitor the time and material usage. If you cannot be there every day then install cameras and check every day otherwise it will not work. You can set up pro accounts with Lowes and Home Depot who will get your approval and release materials to Contractors and send you a detailed list. It only works if you check the materials list and withhold enough pay until a final accounting is complete. If you let either unaccounted time or missing materials go unchecked it will be a huge mistake.